the balance sheet of chandan limited as on 31 december 1998 was as follows liabiliti 590687

The balance sheet of Chandan Limited as on 31 December 1998 was as follows:

Liabilities Amount Assets Amount

Share capital Fixed assets

10000, 6%

redeemable

preference shares of

Rs. 10 each fully

paid

100000 Land & building 150000

50000 equity shares

of Rs. 10 each fully

paid

500000 Plant & machinery 200000

General reserve 90000 Current assets

Profit & loss A/c 230000 Stock 250000

8% debentures 50000 Debtors 180000

Sundry creditors 70000 Cash and bank 260000

1040000 1040000

The directors of the company decided to:

a. Redeem preference shares at a premium of 5%

b. Redeem debentures at a premium of 10%;

c. Bring out a bonus issue for the equity shareholders of one Rs. 10 equity share held in order to

capitalize a part of the undistributed profit.

Show:

The appropriate journal entries to record the transactions in the books of the company;

The balance sheet as it would appear after the completion of the transactions