Balance Sheet taken from the books of M/s unfortunate Limited as on 31 March, 2016 was as follows: 1. Equity and Liabilities (1) Shareholders' Funds (a) Share Capital : 2,500 Equity Shares of $100 each fully paid 2,50,000 (b) Reserves and Surplus Surplus Account (Negative Balance) (-) 62,000 Shareholders' Funds 1,88,000 (2) Current Liabilities Creditors 1,25,000 Total Equity and Liabilities 3,13,000 II. Assets (1) Non-current Assets Fixed Assets : 1,30,000 Land & Buildings 75,000 Plant & Machinery 50,000 (2) Current Assets Stock 50,000 Debtors 57,000 Cash 1,000 Total Assets 3,13,000 The shareholders of the company resolved to take the company into voluntary liquidation and to form M/s Fortunate Limited, a new company with an authorised share capital of $10 lakhs to take over the business on the following terms: 1. Preferential Creditors of $15,000 are to be paid in full. 2. Unsecured Creditors to receive 50 cents in a dollar in full settlement of their claims. 3. 2,500 Equity Shares of $100 each, $60 paid, to be distributed pro-rata to existing shareholders. Five shareholders holding 200 shares dissented and their interest was purchased at $50 per share by an assenting shareholder to whom the shares were transferred. For making payment of creditors uncalled amount of $40 per share was called on 2,500 shares which was duly received. Cost of liquidation amounting to $3,500 was discharged from the amount so called-up. Compute the purchase consideration and prepare the Balance Sheet of the new company assuming that Plant and Machinery, Stock and Trade Debtors were acquired at their book value.
Balance Sheet taken from the books of M/s unfortunate Limited as on 31 March, 2016 was as follows: 1. Equity and Liabilities (1) Shareholders' Funds (a) Share Capital : 2,500 Equity Shares of $100 each fully paid 2,50,000 (b) Reserves and Surplus Surplus Account (Negative Balance) (-) 62,000 Shareholders' Funds 1,88,000 (2) Current Liabilities Creditors 1,25,000 Total Equity and Liabilities 3,13,000 II. Assets (1) Non-current Assets Fixed Assets : 1,30,000 Land & Buildings 75,000 Plant & Machinery 50,000 (2) Current Assets Stock 50,000 Debtors 57,000 Cash 1,000 Total Assets 3,13,000 The shareholders of the company resolved to take the company into voluntary liquidation and to form M/s Fortunate Limited, a new company with an authorised share capital of $10 lakhs to take over the business on the following terms: 1. Preferential Creditors of $15,000 are to be paid in full. 2. Unsecured Creditors to receive 50 cents in a dollar in full settlement of their claims. 3. 2,500 Equity Shares of $100 each, $60 paid, to be distributed pro-rata to existing shareholders. Five shareholders holding 200 shares dissented and their interest was purchased at $50 per share by an assenting shareholder to whom the shares were transferred. For making payment of creditors uncalled amount of $40 per share was called on 2,500 shares which was duly received. Cost of liquidation amounting to $3,500 was discharged from the amount so called-up. Compute the purchase consideration and prepare the Balance Sheet of the new company assuming that Plant and Machinery, Stock and Trade Debtors were acquired at their book value.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Balance Sheet taken from the books of M/s unfortunate Limited as on 31 March, 2016 was as
follows:
1. Equity and Liabilities
(1) Shareholders' Funds
(a) Share Capital :
2,500 Equity Shares of $100 each fully paid
2,50,000
(b) Reserves and Surplus
Surplus Account (Negative Balance)
(-) 62,000
Shareholders' Funds
1,88,000
(2) Current Liabilities
Creditors
1,25,000
Total Equity and Liabilities
3,13,000
II. Assets
(1) Non-current Assets
Fixed Assets :
1,30,000
Land & Buildings
75,000
Plant & Machinery
50,000
(2) Current Assets
Stock
50,000
Debtors
57,000
Cash
1,000
Total Assets
3,13,000
The shareholders of the company resolved to take the company into voluntary liquidation and to
form M/s Fortunate Limited, a new company with an authorised share capital of $10 lakhs to take
over the business on the following terms:
1. Preferential Creditors of $15,000 are to be paid in full.
2. Unsecured Creditors to receive 50 cents in a dollar in full settlement of their claims.
3. 2,500 Equity Shares of $100 each, $60 paid, to be distributed pro-rata to existing shareholders.
Five shareholders holding 200 shares dissented and their interest was purchased at $50 per share
by an assenting shareholder to whom the shares were transferred.
For making payment of creditors uncalled amount of $40 per share was called on 2,500 shares
which was duly received.
Cost of liquidation amounting to $3,500 was discharged from the amount so called-up.
Compute the purchase consideration and prepare the Balance Sheet of the new company assuming
that Plant and Machinery, Stock and Trade Debtors were acquired at their book value.
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