Please give answers for my following queries:
Suppose there are 2 companies named H Ltd. and S.Ltd. H Ltd. acquired 40% shares of S. Ltd on 1/4/06 and next 20% shares of the same company as on 30/09/06. Then for the calculation of capital reserve or goodwill profit for the year 2006-07 attributale to entire 60% or profit attributable to only 20% should be bifurcated between capital and revenue profit? I m talking abt pre and post acquuisition bifurcation of profit.
Further suppose there is another one company named T Ltd. S Ltd. acquired 60% shares of this company as on 1/4/06. H Ltd. also purchased 20% shares in T Ltd. as on 31/12/06. So for the purpose of calculation of capital reserve or goodwill on the investment of H Ltd. in T Ltd. should the profit for 2006-07 attributable to 20% prior 31/12/06 entirely should be treated as capital profit? I m talking abt pre and post acquuisition bifurcation of profit.
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