Hi John
Love your lectures, but regrettably I can't seem shake this P4.
need to know if my understanding of premium payable on acquisition is ok.
I understand the premium payable to be equal to or lesser than the additional value created/earned through acquisition.
so if company A value $300.00
company B Value $400.00
and company Ab Values $1000.00
then premium should be equal or lesser than $300.00
I anxiously await your reply.
Ask the Tutor ACCA AFM
PREMIUM PAYABLE ON ACQUISITION
9y ago#1What you have written is correct :-)
thank you.
9y ago#3You are welcome :-)
hi sir ,
please could you explain how the premium would be equal or "less" than$ 300.
why is there a possibility of being less?
9y ago#5Because why should they give all of the gain (premium) to the shareholders in the company being acquired?? The acquiring company will want to have some benefit :-)
oh right ,
that was very simple,got it thanks.
9y ago#7You are welcome :-)
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