ABC Ltd. acquired an asset 3 years ago at a cost of 5 million. The depreciation method adopted for the asset was 10 percent reducing balance method.…

ABC Ltd. acquired an asset 3 years ago at a cost of 5 million. The depreciation method adopted for the asset was 10 percent reducing balance method. At the end of Year 3, ABC Ltd. estimates that the remaining useful life of the asset is 8 years and determines to adopt straight-line method from that date so as to reflect the revised estimated pattern of recovery of economic benefits. Later ABC Ltd. acquires PQR Ltd. for a consideration of 1 crore. Four years ago, ABC Ltd. had granted a ten-year license allowing PQR Ltd. to operate in Europe. The cost of the license was - 2,50,000. The contract allows either party to terminate the franchise at a cost of the unexpired initial fee plus 20%. At the date of acquisition, the settlement amount is 1,80,000 [(2,50,000 x 6/10) + 20%]. ABC Ltd. has acquired PQR Ltd., because it sees high potential in the European market and wishes to exploit it. ABC Ltd. calculates that under current economic conditions and at current prices it could grant a six-year franchise for a price of 4,50,000. The Accountant of ABC Ltd. has the following information in his possession for the purpose of calculating EPS-Diluted EPS, for the financial year 20X1-20X2: Particulars Amount Net profit attributable to ordinary shareholders 12,00,000 Weighted average number of equity shares 1,50,000 6% convertible debentures of 10,00,000 each 1,000 Convertible into 20 shares Dividend arrears (Cumulative preference shareholders) 10,000 Tax rate 25% Analyze the transactions mentioned above and choose the most appropriate option in the below mentioned questions 8 to 13 in line with the relevant Ind AS: