with the consent of the shareholders the liquidator of weak ltd sold off in open mar 620743
The following is the balance sheet of Weak Ltd. as on 30 June 2010:
|
Liabilities |
Assets |
||
|
16,000 Equity |
16,00,000 |
Buildings |
6,80,000 |
|
Shares of Rs.10 |
Plans & |
16,00,000 |
|
|
Each |
Machinery |
||
|
General Reserve |
2,00,000 |
Investments |
2,02,400 |
|
Profit and Loss |
22,400 |
Debtors |
5,62,000 |
|
A/c |
Stock |
3,22,800 |
|
|
5% Debentures |
10,00,000 |
Cash at Bank |
66,000 |
|
Creditors |
5,14,800 |
||
|
Dividend |
|||
|
Equalization |
96,000 |
||
|
Fund |
|||
|
34,33,200 |
34,33,200 |
Weak Ltd. was absorbed by Strong Ltd. on the above date on the following terms:
- Assume all liabilities and to acquire all assets except investments which were sold by Weak Ltd. for Rs.1,80,000
- Discharge the debenture at a discount of 5% by issue of 7% debentures in Strong Ltd.
- Issue two shares of Rs.60 each in Strong Ltd. at Rs.65 per share and also pay Rs.2 in cash to the shareholders of Weak Ltd. in exchange for one share in Weak Ltd.
- Pay the cost of absorption of Rs.6,000
With the consent of the shareholders, the liquidator of Weak Ltd. sold off in open market one-fourth of the shares received from Strong Ltd. at an average price of Rs.63 per share.
You are required to prepare:
- Statement of surchase consideration
- Important ledger accounts in the books of Weak Ltd.