Priya Ltd. takes over Bhushan Ltd. as at 1st April 2017. The Balance Sheet of Bhushan Ltd.

as at that date was as follows:

Equity and liabilities

Share Capital: Rs.

50,000 Equity Shares of Rs. 10 each fully paid up 5,00,000

General Reserve 2,00,000

Statutory Reserve 1,00,000

12% Debentures (Rs. 100 each, fully paid) 1,00,000

Trade Payables 1,00,000

Total 10,00,000

Assignment

Assets:

Tangible Fixed Assets 5,00,000

Stock in Trade 2,00,000

Trade Receivables 2,00,000

Cash at Bank 1,00,000

Total 10,00,000

Priya Ltd. agreed to issue 30,000 Equity shares of Rs. 10 each at a premium of Rs. 5 per

share to the shareholders of Bhushan Ltd. 12% Debentures of Bhushan Ltd. will be

converted into equivalent number of 12% Debentures of Rs.100 each. Statutory Reserve of

Bhushan Ltd. is to be maintained for two or more years.

Pass acquisition entries in the books of Priya Ltd.