Have a question on the journal entries for pooling difference, question, purchase, between, record

AnalystAlan

I know pooling is no longer allowed but this has bothered me for a while.

How would you record the transaction under pooling?
Since you are not allowed to recognize goodwill, how do you reconcile the difference between the purchase price and the net asset value?

Thank you!

kkn006

Pooling is simply add each asset, Lia and equity line by line for the 2 companies and arrived at the combined balance sheet. Recognize pooling is allowed if 12 conditions are met - acquisition is made via a stock purchase (no cash transaction). So don't write-up the assets and similarly don't writeup the equity that you issued for the acquisition.