Q. Golden Ltd. bought assets for Rs 5,50,00,000 and assumed liabilities worth Rs 1,26,00,000 from Silver Ltd. and issued 8% debentures of Rs 500 each at a premium of 6%. Record necessary journal entries in the books of Golden Ltd.

Dear Student,

(i) Sundry Assets........Dr.            5,50,00,000
                 To Sundry Liabilities                             1,26,00,000
​                 To Silver Ltd.                                        4,24,00,000
( being assets and liabilities of Silver Ltd. taken over)


(ii) Silver Ltd..............  Dr.      4,24,00,000
                 To 8% Debentures A/c (500*80,000)                          4,00,00,000              
                 To Premium on debentures A/C (30*80,000)              24,00,000
(being 80,000 shares issued to silver Ltd. at rs 500 each and premium of rs. 30)

Regards
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