M and N decided to work in partnership with the following scheme, agreeing to share profits...
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M and N decided to work in partnership with the following scheme, agreeing to share profits as under: M-%th share. N-th share. They guaranteed the subscription at par of 10,00,000 shares of 1 each in U Ltd. And to pay all expenses up to allotment in consideration of U Ltd. issuing to them 50,000 other shares of ₹1 each fully paid together with a commission @ 5% in cash which will be taken by M and N in 3:2. M and N introduced cash as follows: M-Stamp Charges, etc., Advertising Charges Printing Charges N― Rent Solicitor's Charges ₹ 4,000 3,000 3,000 2,000 3,000 Application fell short of the 10,00,000 shares by 30,000 shares and N introduced 30,000 for the purchase of those shares. The guarantee having been fulfilled, U Ltd. handed over to the venturers 50,000 shares and also paid the commission in cash. All their holdings were subsequently sold by the venturer N receiving 18,000 and M ₹50,000. Write-up necessary accounts in the books of both the parties on the presumption that Memorandum Joint Venture Account is opened for the purpose. M and N decided to work in partnership with the following scheme, agreeing to share profits as under: M-%th share. N-th share. They guaranteed the subscription at par of 10,00,000 shares of 1 each in U Ltd. And to pay all expenses up to allotment in consideration of U Ltd. issuing to them 50,000 other shares of ₹1 each fully paid together with a commission @ 5% in cash which will be taken by M and N in 3:2. M and N introduced cash as follows: M-Stamp Charges, etc., Advertising Charges Printing Charges N― Rent Solicitor's Charges ₹ 4,000 3,000 3,000 2,000 3,000 Application fell short of the 10,00,000 shares by 30,000 shares and N introduced 30,000 for the purchase of those shares. The guarantee having been fulfilled, U Ltd. handed over to the venturers 50,000 shares and also paid the commission in cash. All their holdings were subsequently sold by the venturer N receiving 18,000 and M ₹50,000. Write-up necessary accounts in the books of both the parties on the presumption that Memorandum Joint Venture Account is opened for the purpose.
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To write up the necessary accounts in the books of M and N for the joint venture we will create the ... View the full answer
Related Book For
Understanding Financial Accounting
ISBN: 978-1118849385
1st Canadian Edition
Authors: Christopher Burnley, Robert Hoskin, Maureen Fizzell, Donald
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