The correct answer is: B. AS-20
AS-20 is an Indian accounting standard that deals with amalgamation of companies. It was issued by the Institute of Chartered Accountants of India (ICAI) in 2003. The standard provides guidance on the accounting treatment of amalgamations, including the recognition and measurement of assets, liabilities, and income and expenses.
AS-20 defines amalgamation as “the merger of two or more companies into one, with the resulting company being a continuation of one of the amalgamating companies.” The standard applies to all amalgamations, regardless of the form of the amalgamation, such as a merger, consolidation, or absorption.
Under AS-20, the assets, liabilities, and income and expenses of the amalgamating companies are recognized and measured at fair value at the date of amalgamation. The fair value of an asset or liability is the price that would be paid to acquire the asset or liability in an arm’s-length transaction between knowledgeable, willing parties.
The standard also provides guidance on the treatment of goodwill and negative goodwill arising from an amalgamation. Goodwill is an asset that arises when the fair value of the net assets acquired in an amalgamation exceeds the consideration transferred. Negative goodwill is a gain that arises when the consideration transferred in an amalgamation exceeds the fair value of the net assets acquired.
AS-20 is a comprehensive standard that provides detailed guidance on the accounting treatment of amalgamations. It is an important standard for all accountants who are involved in the preparation or audit of financial statements of companies that are involved in amalgamations.
The other options are incorrect because they are not accounting standards that deal with amalgamation of companies.