Show me the steps to solve "value on the Equity Shares of the Comneny"The Commande fencial action $2$o all value on the Equity Shares of the Company. The Company's financial position as on $31*$ December, $1997$ is as under :

Liabilities

Rs$.$

Assets

Rs$.$

Share Capital :

$20,0006\%$ Cumulative

Preference Shares of Rs

Fixed Assets $($at Cost$)$

Goodwill

Plant & Machinery

$1,20,000$

$2,00,000$

Conducted by : Prof. Suresh Poojari

GURUKUL

$10/-$ each

$2,00,000$

Investments $($at Cost$)$

$1,20,000$

$12,000$ Equity Shares of

Current Assets :

Rs $20$ each fully paid

$2,40,000$

Stock

$1,20,000$

Debentures Redemption

Debtors

$1\mathrm{.}62,000$

Fund

$40,000$

Cash at Bank

Profit & Loss A$/$c :

Land & Building

$2,00,000$

$01\mathrm{.}01\mathrm{.}1997$

$45,000$

Profit for the Year

$1,30,000$

$($before tax$)$

$5\%$ Debentures

$2,00,000$

Creditors

$1,67,000$

Depreciation Fund $($Plant$)$

$30,000$

$10,52,000$

$10,52,000$

The following information is relevant :

$1)$ Goodwill is revalued at Rs $1,45,000/-<$ Normal rate of return expected is $10\%.$

$3)$ The share of the Company are not freely transferable.

$4)$ Investments are part of business assets.

$5)$ Profits for the year as stated are before annual transfer of Rs $12,700$ t

Debenture Redemption Fund.

$6)$ Income Tax may be taken at $50\%$ of the profits.

$7)$ Dividend record of the company is not stable.

Work out the fair value of equity shares as requested.