Enterprise Ltd. has 2 divisions Laptops and Mobiles. Division Laptops has been making constant profits while division Mobiles has been invariably suffering losses. On 31st March, 2021 the division-wise draft Balance Sheet was: Fixed assets cost Depreciation Net Assets Current assets: Less: Current liabilities Total (A+B) Financed by: Loan funds Capital : Equity 10 each Surplus (A) (B) Laptops 250 (225) 25 200 (25) 175 200 25 175 200 Mobiles 500 (400) 100 500 (400) 100 200 300 (100) 200 (in crores) Total 750 (625) 125 700 (425) 275 400 300 25 75 400 Division Mobiles along with its assets and liabilities was sold for 25 crores to Turnaround Ltd. a new company, who allotted 1 crore equity shares of 10 each at a premium of 15 per share to the members of Enterprise Ltd. in full settlement of the consideration, in proportion to their shareholding in the company.

Enterprise Ltd. has 2 divisions Laptops and Mobiles. Division Laptops has been making constant profits while division Mobiles has been invariably suffering losses. On 31st March, 2021 the division-wise draft Balance Sheet was: Fixed assets cost Depreciation Net Assets Current assets: Less: Current liabilities Total (A+B) Financed by: Loan funds Capital : Equity 10 each Surplus (A) (B) Laptops 250 (225) 25 200 (25) 175 200 25 175 200 Mobiles 500 (400) 100 500 (400) 100 200 300 (100) 200 (in crores) Total 750 (625) 125 700 (425) 275 400 300 25 75 400 Division Mobiles along with its assets and liabilities was sold for 25 crores to Turnaround Ltd. a new company, who allotted 1 crore equity shares of 10 each at a premium of 15 per share to the members of Enterprise Ltd. in full settlement of the consideration, in proportion to their shareholding in the company.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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