KELLETT LTD.

Case 3 - Kellett Ltd

Case 3 - Kellett Ltd

Introduction

The case is related to Kellett Ltd. which produces edge pollution control equipment for industrial and commercial use. Kellett Ltd. has entered in to the agreement with Acme Pollution Control Inc. of selling ownership of the company and the agreement is based on $25 million plus an additional $10 million if the net income before taxes is in excess of $5.35 million and determined through IFRS.

Discussion

From the analysis of the case, it is found that the Kellett Inc. sold the new product to a new customer in Europe at $500,000 with ...