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cost of winding up amounted to rs 5 000 show ledger accounts in the books of express 620752

Express Ltd. has just recovered from a great financial difficulty. Its balance sheet as on 31 December 2010 is as follows:

Liabilities

Assets

Equity Share

3,00,000

Buildings

2,00,000

Capital

Plants &

1,00,000

5% Preference

2,00,000

Machinery

1,00,000

Share Capital

Current Assets

1,75,000

Liabilities

75,000

Profit & Loss A/c

5,75,000

5,75,000

Express (2011) Ltd. is formed to take over buildings at Rs.1,50,000; plant & machinery at 70,000 and Stock at 30,000. Purchase consideration is to be satisfied by 7% preference shares (Rs. 100) and equity shares (Rs. 10) of Express (2011) Ltd. in the ration of 3:2. Preference shareholders are to be settled in full by allotment of the new preference shares. Sundry debtors realized Rs.75,000, and Rs.55,000 was paid to creditors in full settlement. There is no other current asset except stock and debtors. Cost of winding up amounted to Rs.5,000. Show ledger accounts in the books of Express Ltd. and journal entries in the books of Express (2011) Ltd. Also draft the balance sheet of Express (2011) Ltd. Assume that the value of assets taken over is exclusively paid to equity shareholders.

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