Question : K Ltd. took over the assets of Rs. 15,00,000 and liabilities of Rs. 5,00,000 of P Ltd. for a purchase consideration of Rs. 13,68,500. Rs. 25,500 were paid by issuing a promissory note in favour of P Ltd. payable after two months and the balance was paid by issue of equity shares of Rs. 100 each at a premium of 25%.
On the basis of the above question choose the correct option to the following case
Question:- Number of shares issued will be
Option 1: 40,000
Option 2: 10,700
Option 3: 10,744
Option 4: None of these
Correct Answer: 10,744
Solution :
Answer = 10,744
In the Books of K Ltd.
JOURNAL
|
Particulars |
L.F. |
Dr. ( Rs.) |
Cr. ( Rs.) |
|
Sundry Assets A/c ... Dr. Goodwill A/c (Balancing Figure) ... Dr. |
15,00,000 3,68,500 |
||
|
To Sundry Liabilities A/c To PLtd. (Business purchased from P Ltd.) |
5,00,000 |
13,68,500
P Ltd. ... Dr.
13,68,500
To Bills Payable A/c
To Equity Share Capital A/c (10,744 x 7 100)
To Securities Premium Reserve A/c (10,744 x 7 25)
(Bills payable of Rs. 25,500 and 10,744 equity shares of Rs.100 each issued at a premium of 25% against purchase consideration)
25,500
10,74,400
2,68,600
Note: Number of equity shares to be issued = (Purchase consideration - Payment through Promissory Note)/Issue price = Rs.(13,68,500 - 25,500)/Rs.(100 + 25) = 125 = Rs.13,43,000/Rs.125 = 10,744 shares.
