Bharat Lamp Ltd. issued 30,000 fully paid-up shares of ₹ 100 each for purchase of the following assets and liabilities from Sharma & Co:

Plant ₹ 7,00,000 Stock-in-Trade ₹ 9,00,000

Land and Building ₹ 12,00,000 Sundry Creditors ₹ 2,00,000

You are required to pass necessary Journal entries.

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Solution

Books of Bharat Lamp Limited
Journal

Date

Particulars

L.F.

Debit

Amount

(₹)

Credit

Amount

(₹)

Goodwill A/c

Dr.

4,00,000

Plant A/c

Dr.

7,00,000

Stock-in-Trade A/c

Dr.

9,00,000

Land and Building

Dr.

12,00,000

To Sundry Creditors A/c

2,00,000

To Sharma & Co

30,00,000

(Asset purchased and liabilities accepted from Sharma & Co)

Sharma & Co

Dr.

30,00,000

To Share Capital A/c

30,00,000

(30,000 shares of Rs 100 each issued to Sharma & Co.)

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Books of Bharat Lamp Limited Journal
Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount (₹)

	Goodwill A/c	Dr.		4,00,000
	Plant A/c	Dr.		7,00,000
	Stock-in-Trade A/c	Dr.		9,00,000
	Land and Building	Dr.		12,00,000
	To Sundry Creditors A/c				2,00,000
	To Sharma & Co				30,00,000
	(Asset purchased and liabilities accepted from Sharma & Co)

	Sharma & Co	Dr.		30,00,000
	To Share Capital A/c				30,00,000
	(30,000 shares of Rs 100 each issued to Sharma & Co.)

Bharat Lamp Ltd. issued 30,000 fully paid-up shares of ₹ 100 each for purchase of the following assets and liabilities from Sharma & Co: Plant ₹ 7,00,000 Stock-in-Trade ₹ 9,00,000 Land and Building ₹ 12,00,000 Sundry Creditors ₹ 2,00,000 You are required to pass necessary Journal entries.