Please answer 11th question for 50 points
Answers
answer for 11 question
journal entries
when shares issued at par
1) plant and machinery A/c Dr 24,00,000
To X ltd 24,00,000
(being purchased plant and machinery and paid in consideration of equity shares )
2)X Ltd A/c Dr 24,00,000
To equity share capital 24,00,000
(being 24000 equity shares of 100 rs each issued at par )
when shares issues at premium
1) plant and machinery A/c Dr 24,00,000
To X ltd A/c 24,00,000
(being purchased plant and machinery and paid in consideration of equity shares )
2) X Ltd A/c Dr 2400000
To securities premium A/c 4,00,000
To Equity share capital A/c 20,00,000
(being 20000 equity shares of 100 rs each issued at premium at 20% )
working note :
calculation for shares issued at premium
no of shares issued = amount payable / issue price
=2400000/120
=20000
securities premium = 20000*20
=4,00,000
equity share = 20000*100
=20,00,000
Hope its useful ..!!!
Journal entries in the books of X Ltd
Shares issued at par
Plant and machinery A/c Dr 24,00,000
To X ltd a/c 24,00,000
(being purchased plant and machinery and paid in consideration of equity shares )
X Ltd A/c Dr 24,00,000
To equity share capital 24,00,000
(being equity shares issued at par )
shares issued at premium
1) plant and machinery A/c Dr . 24,00,000
To X ltd A/c 24,00,000
Being purchased plant and machinery and paid in consideration of equity shares )
2) X Ltd A/c Dr 2400000
To Securities premium A/c 4,00,000
To Equity share capital A/c 20,00,000
(Being equity shares issued at premium)
Shares issued = Total amount payable / issue price
=2400000÷120=20000
securities premium = 20000×20=4,00,000
equity Share capital = 20000×100=20,00,000