Question

Which of the following features of Amalgamation are in the nature of Merger as per the AS-14? (A). Taking over of select few assets and liabilities.
(B). Intention to carry on the acquired business.
(C). Amalgamation Adjustment Account is opened in the books of transferee company to maintain statutory reserves.
(D). Recording of assets and liabilities of transferor company at book values.

• A. (B), (C) and (D) only
• B. (B) and (D) only
• C. (A), (B), (C) and (D)
• D. (A), (B) and (C) only

Hint:

Understand the difference between merger and acquisition under AS-14.

Answer 1

The Correct Option is A

Mergers typically involve plans to continue operations, preserve required reserves, and record assets at their book values. Conversely, acquisitions often involve assuming only specific assets.