Question 18 Chapter 9 of +2-A – T.S. Grewal 12 Class

Question 18 Chapter 9 of +2-A

Question 18 Chapter 9 of +2-A

18. Bright Ltd. took over the assets of ₹ 6,60,000 and liabilities of ₹ 80,000 of Star Ltd. for an agreed purchase consideration of ₹ 6,00,000 payable 10% in cash and the balance by the issue of 12% Debentures of ₹ 100 each. Give necessary Journal entries in the books of Bright Ltd., assuming that:
Case (a): The debentures are issued at par.
Case (b): The debentures are issued at 20% premium.
Case (c): The debentures are issued at 10% discount. 

The solution of Question 18 Chapter 9 of +2-A: – 

         
Date Particulars
L.F. Debit Credit
  Assets A/c Dr   6,60,000  
  Goodwill A/c Dr   20,000  
  To Liabilities A/c       80,000
  To Star A/c       6,00,000
  (Being business purchased from star ltd. )        
   Star Ltd A/c Dr   60,000  
  To Cash A/c       60,000
  (Being B.P received)        
( a )  Star Ltd. A/c Dr   5,40,000  
  To 12%Debenture A/c       5,40,000
  (Being Debenture Issued)        
( b ) Star Ltd. A/c Dr   5,40,000  
  To 12%Debenture A/c       4,50,000
  To securities premium A/c       90,000
  (Being Debenture Issued)        
( c ) Star Ltd. A/c Dr   5,40,000  
  Discount on issue of Debenture A/c Dr   60,000  
  To 12%Debenture A/c       6,00,000
  (Being Debenture Issued)        

Working Note

 

No of Debenture to be issued  = Purchase consideration = 5,40,000 = 4,500 shares
Issue price 120

 

 

No of Debenture to be issued  = Purchase consideration = 5,40,000 = 6,000 shares
Issue price 90

 

 


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Also, Check out the solved question of previous Chapters: –

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

  • Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
  • Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
  • Chapter No. 3 – Goodwill: Nature and Valuation
  • Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
  • Chapter No. 5 – Admission of a Partner
  • Chapter No. 6 – Retirement/Death of a Partner
  • Chapter No. 7 – Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

  • Chapter No. 1 – Financial Statements of a Company
  • Chapter No. 2 – Financial Statement Analysis 
  • Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
  • Chapter No. 4 – Accounting Ratios
  • Chapter No. 5 – Cash Flow Statement

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

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