Swami Ltd. was formed with an authorised capital of 20,00,000, divided into equity shares of 10 each,

Question:

Swami Ltd. was formed with an authorised capital of ₹20,00,000, divided into equity shares of ₹10 each, to acquired the business of P&M, whose balance sheet on the date of acquisition was as follows:

The purchase price was agreed upon at ₹23,00,000, to be paid in ₹20,00,000 fully-paid equity shares of ₹11 and the balance in cash.

You are required to record the above and prepare the balance sheet of Swami Ltd., assuming the vendor’s account is finally settled.

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Corporate Accounting

ISBN: 9789353160739

1st Edition

Authors: Anita Raman, P. Radhika

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Question Posted: Aug 31, 2023 12:11 PM

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Swami Ltd. was formed with an authorised capital of 20,00,000, divided into equity shares of 10 each,

Question:

Liabilities Capital General Reserves Sundry Creditors (3) Assets 10,00,000 Freehold Premises 7,00,000 Stock 3,00,000 20,00,000 Sundry Debtors Less: Provision for Bad Debts Cash at Bank 2,70,000 20,000 (3) 14,00,000 2,00,000 2,50,000 1,50,000 20,00,000

Step by Step Answer:

Step 1 Record the Purchase Transaction The purchase price is agreed upon at 2300000 to be paid in 20...View the full answer

Corporate Accounting

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