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the balance sheet of power link ltd as on 31st march 2011 is as follows 674535

The balance sheet of Power link Ltd. as on 31st March, 2011 is as follows:

Liabilities

 

 

Assets

Share capital:

 

Fixed Assets

66,00,000

5,00,000 equity shares of

 

Investments

18,00,000

10 each, fully paid

50,00,000

Stock

11,87,000

General Reserve

6,50,000

Sundry debtors

9,60,000

Securities Premium

5,40,000

Cash and bank balance

7,10,000

Profit and Loss Account

3,75,000

 

 

12% Debentures

25,00,000

 

 

Term Loans

13,25,000

 

 

Sundry Creditors

7,42,000

 

 

Provision for tax

1,25,000

 

 

 

1,12,57,000

 

1,12,57,000

The shareholders adopted the resolution on the date of the abovementioned balance sheet to:

(i) buy back 20% of the paid up capital @ Rs.15 each.

(ii) issue 13% debentures of Rs.5,00,000 at a premium of 10% to finance the buy back of shares.

(iii) maintain a balance of Rs.3,00,000 in general reserve account, and

(iv) sell investments worth Rs.8,00,000 for Rs.6,50,000.

Pass necessary journal entries to record the above transactions and prepare the balance sheet immediately after the buy back.

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