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Hello,
Concerning the issue of $100 6% loan note which has been ‘recorded’ by Sanford only, there is a nil value in the NCL section of Sanford.
Does this mean that Sanford should have recorded the 6% loan note there normally, but since this is an inter company transaction with Premier, therefore the 6% loan note has been eliminated?
Thank you
Here’s an extract from the opening paragraph of the question
Please tell me where it says that “Concerning the issue of $100 6% loan note which has been ‘recorded’ by Sanford only, ….”
Extract: “The consideration consisted of two elements: a share exchange of three shares in Premier for every five acquired shares in Sanford and the issue of a $100 6% loan note for every 500 shares acquired in Sanford. The share issue has not yet been recorded by Premier, but the issue of the loan notes has been recorded”
Next point, why would Sanford be recording the loan note? Your question …”Does this mean that Sanford should have recorded the 6% loan note there normally,”
I’m very confused, could you tell me what are the entries that are made when Premier makes an issue of a $100 6% loan note for every 500 shares acquired in Sanford please?
What are the entries that are made in Sanford in case Premier makes an issue of a $100 6% loan note for every 500 shares acquired in Sanford please?
No entries are made in Sanford when Premier issues $100 6% loan notes to the people who formerly held their shares in Sanford but who were tempted to sell those shares to Premier because the offer from Premier was one that these people felt they couldn’t refuse
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