Amalgamation of Firms

When two or more firms merge into one firm and makes a new firm , then this is called amalgamation of firms . For accounting point of view this definition is so important because if one firm purchases other firm , then this is not called amalgamation but if both firms decide to join or integrate then this is called amalgamation .

For Example

Suppose A and B firm decide to close their business and start the business with the name of AB firm after joining with each other then this is called amalgamation of A and B firm