B' Ltd. took over the assets of Rs. $14, 00, 000$ and liabilities of Rs. $4, 00, 000$ of C Ltd. for a purchase consideration of Rs. $9, 19, 000$ . Rs. $17, 000$ were paid by a bank draft in favour of C Ltd. and the balance was paid by issue of equity shares of Rs. $10$ each at a premium of $10 %$ in favour of C Ltd.
Pass necessary journal entries for the above transactions in the books of B Ltd.

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Solution

Working Notes:
WN1: Calculation of number of Equity Shares
Number of shares Issued $= \frac{P u r c h a s e C o n s i d e r a t i o n}{I s s u e p r i c e}$
$= \frac{9, 02, 000}{11} = 82, 000$ equity shares.

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Working Notes:WN1: Calculation of number of Equity SharesNumber of shares Issued =PurchaseConsiderationIssueprice=9,02,00011=82,000 equity shares.

Working Notes:
WN1: Calculation of number of Equity Shares
Number of shares Issued $= \frac{P u r c h a s e C o n s i d e r a t i o n}{I s s u e p r i c e}$
$= \frac{9, 02, 000}{11} = 82, 000$ equity shares.