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4. Gagandeep Ltd., had been suffering heavy losses in the past. It now decides to reconstruct and its Balance Sheet is as follows. Balance Sheet as on 31st December 2020. Share Capital: Authorized: 20,000 equity shares of 100 each Goodwill 3,00,000 Fixed assets 15,85,000 Stock 95,000 20,00,000 Sundry Debtors 50,000 5000 6% pref. shares of 2100 each Investments 20,000 5,00,000 Cash at Bank 12,000 2500000 Preliminary expenses 5,000 Issued subscribed and Paid up Discount on issue of shares 3,000 10,000 equity shares of 100 Profit and loss account 12,90,000 each 10,00,000 2000 6% prof. shares of 100 each (Dividend in arrears for 5 2,00,000 years) 5% Debentures of 100 each 16,60,000 Sundry creditors 4,80,000 Liabilities for IT amin 20,000 33,60,000 33,60,000 The following scheme of reconstruction was agreed upon and duly confirmed by the court. a) The equity shares shall be reduced to shares of *10 each, *5 per share paid up. b) The debenture holders agreed to have 60% of their claims which shall be discharged by the issue of 7.5% debentures of 100 each. c) The sundry creditors are required to forego 60% of their claims. d) The assets to be re-valued as follows: Fixed assets 12,00,000, stock in trade 70,000, sundry debtors 40,000 and investment 10,000. Show the Journal entries and the Balance Sheet after reconstruction. 11.SI Co Ltd os of 31 12 2020

4. Gagandeep Ltd., had been suffering heavy losses in the past. It now decides to reconstruct and its Balance Sheet is as follows. Balance Sheet as on 31st December 2020. Share Capital: Authorized: 20,000 equity shares of 100 each Goodwill 3,00,000 Fixed assets 15,85,000 Stock 95,000 20,00,000 Sundry Debtors 50,000 5000 6% pref. shares of 2100 each Investments 20,000 5,00,000 Cash at Bank 12,000 2500000 Preliminary expenses 5,000 Issued subscribed and Paid up Discount on issue of shares 3,000 10,000 equity shares of 100 Profit and loss account 12,90,000 each 10,00,000 2000 6% prof. shares of 100 each (Dividend in arrears for 5 2,00,000 years) 5% Debentures of 100 each 16,60,000 Sundry creditors 4,80,000 Liabilities for IT amin 20,000 33,60,000 33,60,000 The following scheme of reconstruction was agreed upon and duly confirmed by the court. a) The equity shares shall be reduced to shares of *10 each, *5 per share paid up. b) The debenture holders agreed to have 60% of their claims which shall be discharged by the issue of 7.5% debentures of 100 each. c) The sundry creditors are required to forego 60% of their claims. d) The assets to be re-valued as follows: Fixed assets 12,00,000, stock in trade 70,000, sundry debtors 40,000 and investment 10,000. Show the Journal entries and the Balance Sheet after reconstruction. 11.SI Co Ltd os of 31 12 2020

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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4. Gagandeep Ltd., had been suffering heavy losses in the past. It now decides to reconstruct and its Balance Sheet is as follows. Balance Sheet as on 31st December 2020. Share Capital: Authorized: 20,000 equity shares of 100 each Goodwill 3,00,000 Fixed assets 15,85,000 Stock 95,000 20,00,000 Sundry Debtors 50,000 5000 6% pref. shares of 2100 each Investments 20,000 5,00,000 Cash at Bank 12,000 2500000 Preliminary expenses 5,000 Issued subscribed and Paid up Discount on issue of shares 3,000 10,000 equity shares of 100 Profit and loss account 12,90,000 each 10,00,000 2000 6% prof. shares of 100 each (Dividend in arrears for 5 2,00,000 years) 5% Debentures of 100 each 16,60,000 Sundry creditors 4,80,000
Transcribed Image Text:4. Gagandeep Ltd., had been suffering heavy losses in the past. It now decides to reconstruct and its Balance Sheet is as follows. Balance Sheet as on 31st December 2020. Share Capital: Authorized: 20,000 equity shares of 100 each Goodwill 3,00,000 Fixed assets 15,85,000 Stock 95,000 20,00,000 Sundry Debtors 50,000 5000 6% pref. shares of 2100 each Investments 20,000 5,00,000 Cash at Bank 12,000 2500000 Preliminary expenses 5,000 Issued subscribed and Paid up Discount on issue of shares 3,000 10,000 equity shares of 100 Profit and loss account 12,90,000 each 10,00,000 2000 6% prof. shares of 100 each (Dividend in arrears for 5 2,00,000 years) 5% Debentures of 100 each 16,60,000 Sundry creditors 4,80,000
Liabilities for IT amin 20,000 33,60,000 33,60,000 The following scheme of reconstruction was agreed upon and duly confirmed by the court. a) The equity shares shall be reduced to shares of *10 each, *5 per share paid up. b) The debenture holders agreed to have 60% of their claims which shall be discharged by the issue of 7.5% debentures of 100 each. c) The sundry creditors are required to forego 60% of their claims. d) The assets to be re-valued as follows: Fixed assets 12,00,000, stock in trade 70,000, sundry debtors 40,000 and investment 10,000. Show the Journal entries and the Balance Sheet after reconstruction. 11.SI Co Ltd os of 31 12 2020
Transcribed Image Text:Liabilities for IT amin 20,000 33,60,000 33,60,000 The following scheme of reconstruction was agreed upon and duly confirmed by the court. a) The equity shares shall be reduced to shares of *10 each, *5 per share paid up. b) The debenture holders agreed to have 60% of their claims which shall be discharged by the issue of 7.5% debentures of 100 each. c) The sundry creditors are required to forego 60% of their claims. d) The assets to be re-valued as follows: Fixed assets 12,00,000, stock in trade 70,000, sundry debtors 40,000 and investment 10,000. Show the Journal entries and the Balance Sheet after reconstruction. 11.SI Co Ltd os of 31 12 2020
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