Volume-2 | Chapter-1 | Question 31 to 35 | Issue of Share Capital | Ts grewal solution 2020-21 | Class-12th

Page No 8.115:

Question 31:

Z Ltd . purchased furniture costing  ` 2,20,000 from C.D Ltd. The payment was to be made by issue of 9% Preference Shares of  ` 100 each  ata  premium of  ` 10 per share . Pass necessary Journal entries in the books of Z Ltd.



Answer:

Books of Z Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

  `

Credit Amount

  `

 

 

 

 

 

 

Assets A/c

Dr.

 

2,20,000

 

 

To C.D Ltd.

 

 

2,20,000

 

(Assets purchased from C.D Ltd.)

 

 

 

 

 

 

 

 

 

C.D Ltd.

Dr.

 

2,20,000

 

 

To 9% Preference Share Capital

 

 

2,00,000

 

To Securities Premium A/c

 

 

20,000

 

(2,000 9% Preference Shares of  ` 100 each issued at 10% premium to C.D Ltd.)

 

 

 

 

 

 

 

 

 

Working Note:

          Number of shares issued=2,20,000/100+10=2,000 shares       



Page No 8.115:

Question 32:

Goodluck Ltd purchased  machinery costing  ` 10,00,000 from Fair Deals Ltd. The company paid the price by issue of Equity Shares of  ` 10 each at a premium of 25%.
Pass necessary Journal entries for the above transactions in the books of Goodluck Ltd. 



Answer:

Books Goodluck Ltd.

Journal

Date

Particulars

L.F.

Debit

 Amount

  `

Credit

Amount

  `

 

 

 

 

 

 

Machinery A/c

Dr.

 

10,00,000

 

 

To Fail Deals Ltd.

 

 

10,00,000

 

(Machinery purchased from Fair Deals Ltd.)

 

 

 

 

 

 

 

 

 

Fair Deals Ltd.

Dr.

 

10,00,000

 

 

To Equity Share Capital A/c

 

 

8,00,000

 

To Securities Premium A/c

 

 

2,00,000

 

(80,000 equity shares of  ` 10 each issued at 25% premium)

 

 

 

 

 

 

 

 

 

Working Note:

 

Number of shares issued=10,00,000/10+2.5=80,000 shares    



Page No 8.115:

Question 33:

Jain Ltd  purchased machinery costing  ` 10,00,000 from Ayer Ltd. 50% of the payment was made by cheque and for the remaining 50% , the company issued Equity Shares of  ` 100 each at a premium of 25% . Pass necessary Journal entries  in the books of Jain Ltd . for the above transaction.



Answer:

Books of Jain Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

 `

Credit

Amount

  `

 

 

 

 

 

 

Machinery A/c

Dr.

 

10,00,000

 

 

To Ayer Ltd.

 

 

10,00,000

 

(Machinery purchased from Ayer Ltd.)

 

 

 

 

 

 

 

 

 

Ayer Ltd.

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Payment made to Ayer Ltd.)

 

 

 

 

 

 

 

 

 

Ayer Ltd.

Dr.

 

5,00,000

 

 

To Equity Share Capital A/c

 

 

4,00,000

 

To Securities Premium A/c

 

 

1,00,000

 

(4,000 equity shares of  ` 100 each issued at 25% premium)

 

 

 

 

 

 

 

 

 

Working Note-

 

Amount paid through bank draft =10,00,000×50/100=5,00,000

Number of shares issued = 5,00,000/100+25 =4,000 shares    



Page No 8.115:

Question 34:

Sona Ltd.  purchased machinery costing  ` 17,00,000 from Mona Ltd. Sona Ltd. paid 20% of the amount by cheque and for the balance amount issued Equity Shares of  ` 100 each at a premium of 25% . Pass necessary Journal entries for the above transactions in the books of Sona Ltd .Show your working notes clearly.



Answer:

Journal
In the Books of Sona Ltd.

Date

Particulars

L.F.

Debit

Amount

( `)

Credit

Amount

( `)

 

 

 

 

 

 

 

Machinery A/c

Dr.

 

17,00,000

 

 

To Mona Ltd.

 

 

 

17,00,000

 

(Machinery purchased on credit from Sona Ltd.)

 

 

 

 

 

 

 

 

 

 

 

Mona Ltd.

Dr.

 

3,40,000

 

 

To Bank A/c

 

 

 

3,40,000

 

(20% amount paid through cheque)

 

 

 

 

 

 

 

 

 

 

 

Mona Ltd. (17,00,000 – 3,40,000)

Dr.

 

13,60,000

 

 

To Equity Share Capital*

 

 

 

10,88,000

 

To Securities Premium A/c*

 

 

 

2,72,000

 

(Issued 10,880 shares of  ` 100 each to Mona Ltd. at 25% Premium)

 

 

 

 

 

 

 

 

 

 

 

Working Notes: *

 

Number of shares = purchase consideration/face value of share+premium=13,60,000/100+25=10,880 shares

Amount of shares capital  issued=10,880×100=10,88,000

Amount of securities premium on shares issued=10,88,000×25/100=2,72,000



Page No 8.115:

Question 35:

Bharat Lamp Ltd. issued 30,000 fully paid-up shares of   ` 100 each for purchase of the following assets and liabilities from Sharma & Co:
 

Plant

   ` 7,00,000

 Stock-in-Trade

  ` 9,00,000

Land and Building

   ` 12,00,000

 Sundry Creditors

   ` 2,00,000




You are required to pass necessary Journal entries.



Answer:

Books of Bharat Lamp Limited
Journal 

Date

Particulars

L.F.

Debit

 Amount

( `)

Credit

 Amount

( `)

 

 

 

 

 

 

Goodwill A/c

Dr.

 

4,00,000

 

 

Plant A/c

Dr.

 

7,00,000

 

 

Stock-in-Trade A/c

Dr.

 

9,00,000

 

 

Land and Building

Dr.

 

12,00,000

 

 

To Sundry Creditors A/c

 

 

2,00,000

 

To Sharma & Co

 

 

30,00,000

 

(Asset purchased and liabilities accepted from Sharma & Co)

 

 

 

 

 

 

 

 

 

Sharma & Co

Dr.

 

30,00,000

 

 

To Share Capital A/c

 

 

30,00,000

 

(30,000 shares of  ` 100 each issued to Sharma & Co.)

 

 

 

 

 

 

 

 

 


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