Problem 10:- Good Luck Ltd. Decided to redeem its preference shares as on March 31, 2016 on which date its position was as under : Share Capital : ; 12% Redeemable Preference Shares of $ 100 each fully paid up $ 30,00,000 ; Equity Shares of 100 each fully paid up $ 1,70,00,000 ; Securities Premium Reserve $ 17,00,000 ; General Reserve $ 25,00,000; Other Liabilities $ 58,00,000. The Board of Directors decided to redeem the preference shares both by issue of fresh capital and by utilisation of reserves but without any further borrowings. You are required to advise them the scheme for redemption along with Journal Entries.

Problem 10:- Good Luck Ltd. Decided to redeem its preference shares as on March 31, 2016 on which date its position was as under : Share Capital : ; 12% Redeemable Preference Shares of $ 100 each fully paid up $ 30,00,000 ; Equity Shares of 100 each fully paid up $ 1,70,00,000 ; Securities Premium Reserve $ 17,00,000 ; General Reserve $ 25,00,000; Other Liabilities $ 58,00,000. The Board of Directors decided to redeem the preference shares both by issue of fresh capital and by utilisation of reserves but without any further borrowings. You are required to advise them the scheme for redemption along with Journal Entries.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Problem 10:-
Good Luck Ltd. Decided to redeem its preference shares as on March 31,
2016 on which date its position was as under :
Share Capital : ; 12% Redeemable Preference Shares of $ 100 each fully
paid up $ 30,00,000 ; Equity Shares of 100 each fully paid up $ 1,70,00,000 ;
Securities Premium Reserve $ 17,00,000 ; General Reserve $ 25,00,000;
Other Liabilities $ 58,00,000.
The Board of Directors decided to redeem the preference shares both by
issue of fresh capital and by utilisation of reserves but without any further
borrowings. You are required to advise them the scheme for redemption
along with Journal Entries.

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