For long-term investment in the case of a business combination under the same controlThe cost of long-term investment is forever, forever, forever, equal to the share of the book value of the owner's equity of the merged party in the consolidated financial statements of the ultimate controller.
That is, in a business combination under the same control,The cost of the long-term equity investment on the consolidated party's single statement is a fixed value.
However, the consideration paid by the merging party to acquire the merged party from the ultimate controlling party may not necessarily be equal to the fixed value of the long-term equity investment.
In the previous example, if Company C holds 100% of the equity of Company A and 100% of the equity of Company B, then in the group formed by A, B and C, the ultimate controlling party is C, and if Company A obtains 100% of the equity of Company B from Company C, the merger of A and B is called a business combination under the same control.
To do things, we must grasp the main contradictions, and to engage in mergers, we must also figure out the core boss, and see who decides the cost of long-term investment.
The value of B can only be determined by the father C, except for C, no one can bully B, oh is not right, there is no one who can define the value of B.
I seem to smell a hint of a domineering president.
For A, I can spend as much as I want to get B, and the cost of A is not necessarily equal to the value of B.
For example, the book value of B on C's consolidated statement is 12 million, and A spends 10 million in cash to obtain B;
Or, the book value of B on C's consolidated statements is still 12 million, and A spent 15 million to obtain B;
The question is, what about the difference?
A's account must not be written like this:
Borrow: 12 million long-term investment.
Credit: Bank deposits of 10 million.
Or. Borrow: 12 million long-term investment.
Credit: Bank deposits of 15 million.
What about the saying that "there is a loan, there must be a loan, and the loan must be equal"?
The coffin board of the father of accounting is about to fly out!
The textbook tells us that the difference is included in the capital reserve.
Spend less to increase capital reserves, and spend more to offset capital reserves.
Why has [Capital Reserve] become this glorious trash can, oh no, it is the chosen son of this glory?
Come on, let's think back to whom Company A paid the price?
I gave it to Company C.
Who is Company C?
The parent company of Company A.
What did Company A get back after paying the consideration?
It was Company C's original equity interest in Company B.
In other words, the essence of this transaction is that Company A pays its own father (that is, Company C) to buy an asset in the hands of his father-B.
As long as it is a transaction, there is a loss and a profit.
But the transaction here is a transaction between one's own family and one's own family.
If you buy and make money, that is, B was originally worth 12 million, but your father only charged you 10 million, can you lick your face and say that you earned 2 million? !
This is a gratuitous alms and gifts from Dad to you when he sees that you are pitiful;
To put it another way, it's called shareholder additional investment.
It's not just open source that can increase profits, but also throttling;
In the same way, it is not called additional investment if you are not directly given money, but also additional investment when you pay less.
If you lose money, that is, B was originally only worth 12 million, but your father and lion opened his mouth and asked you for 15 million, can you willingly admit the loss of 3 million? !
This is the landlord's father has no food left in his pocket, so he can only get some wool from his son;
To put it another way, it's called shareholder withdrawal of investment.
It's not just your dad who directly recovers your money that is called divestment, and it is also called divestment if you spend more money in vain.
The purpose is the same anyway, to get you to give your money back to Dad.
And [Capital reserveThis subject itself reflects the father, oh is not right, it is a shareholder, the capital investment in the enterprise, you see, additional investment, withdrawal of investment, isn't it capital investment?
In addition to the capital reserve, can this difference be included in the **?