Liabilities 5.000, 8. Preference Shares of Rs10 each 5.000 Equity Shares of Rato each Creditor...
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Liabilities 5.000, 8. Preference Shares of Rs10 each 5.000 Equity Shares of Rato each Creditor Bank Overdran Amount (Rs) Assets Goodwill 50.000 Buildings Plant 50.000 Debtors 18.000 Stock 20.000 Preliminary expenses Profit & Loss Ne Cash 118.000 Amount RS) 1,00,000 4.000 5.000 1.200 22.000 3.000 2.500 300 11 000 The following scheme of Reconstruction was adopted; 1. Rs. 10 Preference Shares were to be reduced to an equal number of fully paid shares of Rss each 2. Rs. 10 Equity shares were to be reduced to an equal number of fully paid shares of Rss each 3. Creditors are agreed to forego Rs. 8.000 4. The amount thus available was to be in to the nominal assets and the balance if any, to be written off Goodwill Pass necessary journal entries and prepare PORN od balance shers
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