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CA Final | Understanding how to determine Pre and post Acquisition Profits

2015-07-10 6 Dailymotion

All profits earned upto the Acquisition Date are Pre Acquisition Profits while all profits earned after the Acquisition date are post acquisition profits. The relevance of the two is that while Pre-Acquisition profits are reduced from investment to compute Goodwill, post acquisition profits are added to the Profit and Loss Accu==ount of Holding company, from an accounting perspective.