pass journal entries to give effect to the above arrangements assuming that the comp 617025

The capital structure of Suncity Ltd. consists of 50,000 equity shares of Rs.10 each and 2,000 8% redeemable preference shares of Rs.100 each fully paid up. Undistributed reserves and surplus stood as follows:

Cash and Bank amounted to Rs.1,96,000. Preference shares are to be redeemed at a premium of 10% and for the purpose of redemption, the directors are empowered to make a fresh issue of equity shares at par after utilizing the undistributed reserves and surplus, subject to the condition that a sum of Rs.40,000 shall be retained in general reserve.

Pass journal entries to give effect to the above arrangements assuming that the company could not trace the holders of 100 preference shares.