The following is the summarized balance sheet ofAZ Ltd.
|
Liabilities |
Assets |
||
|
Paid-Up Capital: |
Sundry assets |
12,80,000 |
|
|
3,0009% Pref. |
3,00,000 |
Cash at bank |
1,42,500 |
|
Shares of Rs. 100 |
|||
|
Each Fully Paid |
|||
|
1,500 7% Pref. |
1,12,500 |
||
|
Shares of Rs. 100 |
|||
|
Each,Rs.75 Paid |
|||
|
Up |
|||
|
7,500 Equity |
7,50,000 |
||
|
Shares of 100 |
|||
|
Each |
|||
|
Capital Reserve |
50,000 |
||
|
Securities |
|||
|
Premium |
30,000 |
||
|
Current Liabilities |
1,80,000 |
||
|
14,22,500 |
14,22,500 |
It was decided to redeem both the classes of preference shares at a premium of 5%. The company issued equity shares of Rs.100 each at a premium of 10% as were necessary to provide cash for redemption. The issue was fully subscribed and all the moneys were received. You are required to give journal entries and prepare the balance sheet.