Home
Class 12
ACCOUNTS
(Issue of Shares for Purchase of Busines...

(Issue of Shares for Purchase of Business).
Tiny Toys Ltd. purchased the business of Ram Bros. for Rs. 1,80,000 payable in fully paid Equity Shares of Rs. 10 each. What entries will be passed in the books of Tiny Toys Ltd. if the issue is :(i) at par and (ii) at a premium of 20%?

Text Solution

Verified by Experts


Working Notes: Number of Equity Shares to be issued=`("Purchase Consideration")/(" Issue Price of a Share")`
1. No. of Equity Shares=`(Rs. 1,80,000)/(Rs. 10)`=18,000 shares, 2. No. of Equity Shares = `(Rs. 1,80,000)/(Rs. 12)`=15,000 shares.
Promotional Banner

Topper's Solved these Questions

  • COMPANY ACCOUNTS- ACCOUNTING FOR SHARE CAPITAL

    TS GREWAL|Exercise Example|1 Videos

  • COMPANY ACCOUNTS- ACCOUNTING FOR SHARE CAPITAL

    TS GREWAL|Exercise 8.1|2 Videos

  • COMPANY ACCOUNTS REDEMPTION OF DEBENTURES

    TS GREWAL|Exercise EXERCISE|24 Videos

  • DISSOLUTION OF A PARTNERSHIP FIRM

    TS GREWAL|Exercise Evaluation Questions : Questions with Missing Values|4 Videos