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: – 

     
DateParticulars
L.F.DebitCredit
 Assets A/cDr 6,60,000 
 Goodwill A/cDr 20,000 
 To Liabilities A/c   80,000
 To Star A/c   6,00,000
 (Being business purchased from star ltd. )    
  Star Ltd A/cDr 60,000 
 To Cash A/c   60,000
 (Being B.P received)    
( a ) Star Ltd. A/cDr 5,40,000 
 To 12%Debenture A/c   5,40,000
 (Being Debenture Issued)    
( b )Star Ltd. A/cDr 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/cDr 5,40,000 
 Discount on issue of Debenture A/cDr 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 price120

 

 

No of Debenture to be issued =Purchase consideration=5,40,000=6,000 shares
Issue price90

 

 


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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)

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)

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

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