The Balance Sheet of Moon Ltd. as on 31.3.2016 was as follows: Sun Ltd. was formed to
Question:
The Balance Sheet of Moon Ltd. as on 31.3.2016 was as follows:
Sun Ltd. was formed to take over the business of Moon Ltd. on the following terms :
(i) Preferential creditors to be paid ₹ 10,000 in full.
(ii) Ordinary creditors be given the option to either accept 50% of their claims in cash or convert their claims into 12% Debentures of Sun Ltd. (half the ordinary creditors opted for cash).
(iii) Debentures be discharged by the issue of sufficient number of 12% Debentures of Sun Ltd. as would bring the same amount of interest.
(iv) Shareholders be issued 2,000 Equity Shares of ₹ 100 each of Sun Ltd. at a premium of 20%.
(v) Liquidation expenses ₹ 5,000 be paid. Prepare the necessary accounts to close the books of Moon Ltd. and prepare the Balance Sheet of Sun Ltd. assuming that the assets of Moon Ltd. are taken over at 25% discount.
Step by Step Answer:
Corporate Accounting As Per The Companies Act 2013 Including Rules 2014 And 2015
ISBN: 9789352605569
2nd Edition
Authors: M Hanif, A Mukherjee