X Limited and Y Limited agreed to amalgamate and form in your company called Limited. The...

 

Transcribed Image Text:

X Limited and Y Limited agreed to amalgamate and form in your company called Limited. The balance sheet on the date of amalgamation was as under: X Co. Liabilities Equity share capital Shares of 100 each Reserve fund Sundry creditors Bank loan 100000 Y Co. Assets 310000 140000 170000 100000 40000 90000 90000 420000 Fixed assets Stock Debtors Cash X Co. 120000 60000 60000 50000 Y Co.* 180000 110000 130000 310000 420000 Consideration was to be based on the net assets of the company but subject to an addition to compensate *90000 to X Limited for its super profit. The shares of Z Limited, were to be issued to X limited and Y Limited at a premium and in proportion to the agreed net assets. Z Limited proposed to issue 12000 shares of 10 each at a price of *15 per share. You are required to pass opening journal entries and balance sheet in the books of Z Limited. X Limited and Y Limited agreed to amalgamate and form in your company called Limited. The balance sheet on the date of amalgamation was as under: X Co. Liabilities Equity share capital Shares of 100 each Reserve fund Sundry creditors Bank loan 100000 Y Co. Assets 310000 140000 170000 100000 40000 90000 90000 420000 Fixed assets Stock Debtors Cash X Co. 120000 60000 60000 50000 Y Co.* 180000 110000 130000 310000 420000 Consideration was to be based on the net assets of the company but subject to an addition to compensate *90000 to X Limited for its super profit. The shares of Z Limited, were to be issued to X limited and Y Limited at a premium and in proportion to the agreed net assets. Z Limited proposed to issue 12000 shares of 10 each at a price of *15 per share. You are required to pass opening journal entries and balance sheet in the books of Z Limited.

Answer rating: 100% (QA)

is the merger of two or more existing businesses into a single ... View the full answer