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Question

A Ltd. Acquired assets worth Rs. 11,25,000 from B. Ltd. by issue of equality shares of Rs. 100 at premium of 25%. The number of shares to be issued by A Ltd, for the purchase consideration.

A
9000 shares
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B
11250 shares
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C
14063 shares
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D
7500 shares
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Solution

The correct option is A 9000 shares
The equity shares benefits a company with issue of such as purchase consideration, that is, purchase of assets.
MarketValueofshare=Facevalue+Premium
Substitute values in the above equation
MarketValueofshare=Rs100+Rs25=Rs125

Numberofshares=PurchasevalueMarketvalueofshare
Substitute values in the above equation
Numberofshare=Rs11,25,000Rs125=9,000shares.

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