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Continuing the example: NCI proportionate at 30% of ₹516.5 = ₹154.95; PC = ₹87.43 lakh (₹56 + deferred ₹28.93 + replacement ₹2.5). Goodwill or capital reserve:
AGoodwill ₹274.12 lakh
BGoodwill ₹516.5 lakh
CCapital reserve ₹274.12 lakh (bargain purchase: net assets ₹516.5 − NCI ₹154.95 − PC ₹87.43 = ₹274.12 excess)
DCapital reserve ₹87.43 lakh
Answer & Solution
Correct answer: C. Capital reserve ₹274.12 lakh (bargain purchase: net assets ₹516.5 − NCI ₹154.95 − PC ₹87.43 = ₹274.12 excess)
Net assets attributable to acquirer = ₹516.5 − NCI ₹154.95 = ₹361.55 lakh. PC ₹87.43 lakh < ₹361.55 lakh → bargain purchase of ₹274.12 lakh → capital reserve (with clear evidence) via OCI or directly to equity if no clear evidence.
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