Following is the Balance Sheet of Redeemable Limited : 2$ I. Equity and Liabilities (1) Shareholders' Funds (a) Paid-up Share Capital : 10% 1,000 Redeemable Preference Shares of $ 100 each fully called up Less : Calls in Arrears on 50 Shares @ $ 20 each 1,00,000 1,000 99,000 5,00,000 50,000 Equity Shares of $10 each (b) Reserves and Surplus : Development Rebate Reserve General Reserve 50,000 1,00,000 1,50,000 1,51,000 (2) Other Liabilities Total Equity and Liabilities 9,00,000 II. Assets Other Assets 8,10,000 90,000 Bank Total Assets 9,00,000 The Redeemaule Preference Shares were redeemed on the following basis : (1) Further 4,500 equity shares were issued at a premium of 10 per cent; (2) of the 50 Preference Shares, holders for 40 shares paid the call before the date of redemption. The balance 10 shares were forfeited for non-payment of calls before redemption. The forfeited shares were reissued as fully paid on receipt of $500 before redemption; (3) Preference shares were redeemed at a premium of 10 per cent, and securities premium reserve amount was utilised in full for the purpose. Show Journal Entries including those relating to cash and the summarised Balance Sheet after redemption showing rough workings.
Following is the Balance Sheet of Redeemable Limited : 2$ I. Equity and Liabilities (1) Shareholders' Funds (a) Paid-up Share Capital : 10% 1,000 Redeemable Preference Shares of $ 100 each fully called up Less : Calls in Arrears on 50 Shares @ $ 20 each 1,00,000 1,000 99,000 5,00,000 50,000 Equity Shares of $10 each (b) Reserves and Surplus : Development Rebate Reserve General Reserve 50,000 1,00,000 1,50,000 1,51,000 (2) Other Liabilities Total Equity and Liabilities 9,00,000 II. Assets Other Assets 8,10,000 90,000 Bank Total Assets 9,00,000 The Redeemaule Preference Shares were redeemed on the following basis : (1) Further 4,500 equity shares were issued at a premium of 10 per cent; (2) of the 50 Preference Shares, holders for 40 shares paid the call before the date of redemption. The balance 10 shares were forfeited for non-payment of calls before redemption. The forfeited shares were reissued as fully paid on receipt of $500 before redemption; (3) Preference shares were redeemed at a premium of 10 per cent, and securities premium reserve amount was utilised in full for the purpose. Show Journal Entries including those relating to cash and the summarised Balance Sheet after redemption showing rough workings.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Following is the Balance Sheet of Redeemable Limited:
24
I. Equity and Liabilities
(1) Shareholders' Funds
(a) Paid-up Share Capital :
10% 1,000 Redeemable Preference Shares
of $ 100 each fully called up
Less : Calls in Arrears on 50 Shares @ $ 20 each
1,00,000
1,000
99,000
5,00,000
50,000 Equity Shares of $10 each
(b) Reserves and Surplus :
Development Rebate Reserve
General Reserve
50,000
1,00,000
1,50,000
1,51,000
(2) Other Liabilities
Total Equity and Liabilities
9,00,000
II. Assets
Other Assets
8,10,000
90,000
Bank
Total Assets
9,00,000
The Redeemaule Preference Shares were redeemed on the following basis :
(1) Further 4,500 equity shares were issued at a premium of 10 per cent;
(2) of the 50 Preference Shares, holders for 40 shares paid the call before the date of redemption.
The balance 10 shares were forfeited for non-payment of calls before redemption. The
forfeited shares were reissued as fully paid on receipt of $500 before redemption;
(3) Preference shares were redeemed at a premium of 10 per cent, and securities premium reserve
amount was utilised in full for the purpose.
Show Journal Entries including those relating to cash and the summarised Balance Sheet
after redemption showing rough workings.
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