The balance sheet of Prateek Ltd. disclosed the following position as on 31 st March, 2018 : Particulars Amount (₹) I. EQUITY AND LIABILITIES 1. Shareholders' fund (a) Equity Share Capital 5,000 Shares of ₹100 each fully

CS Executive · Corporate and Management Accounting · PYQS · December 2018
The balance sheet of Prateek Ltd. disclosed the following position as on 31 st March, 2018 : Particulars Amount (₹) I. EQUITY AND LIABILITIES 1. Shareholders' fund (a) Equity Share Capital 5,000 Shares of ₹100 each fully paid up 5,00,000 5,000 Shares of ₹100 each ₹60 paid up 3,00,000 5,000 Shares of ₹100 each ₹40 paid up 2,00,000 (b) Reserves and Surplus General Reserve 6,50,000 2. Current Liabilities Creditors 10,00,000 TOTAL 26,50,000 II. ASSETS 1. Non-current Assets Fixed Assets Land & Buildings 14,00,000 Goodwill 50,000 2. Current Assets 12,00,000 TOTAL 26,50,000 Compute the value per share of each category of equities by the 'Net Assets Method'. Goodwill is valueless.

Answer & Explanation:

Calculations of Net Assets Land & Buildings 14,00,000 Add: Current Assets 12,00,000 26,00,000 Less: Creditor 10,00,000 Value of Net Assets 16,00,000 Paid up Value of total equity shares of A, B & C Category is 5,00,000, 3,00,000 & 2,00,000 respectively. Ratio 5:3:2. The net assets of ₹16,00,000 will be apportioned in 5:3:2. Therefore Portion of A Category Equity Shares = 16,00,000 * 5/10 = ₹8,00,000 Per Share value of A Category equity shares = 8,00,000 / 5000 = ₹160 Therefore Portion of B Category Equity Shares = 16,00,000 * 3/10 = ₹4,80,000 Per Share value of B Category equity shares = 4,80,000 / 5000 = ₹96 Therefore Portion of C Category Equity Shares = 16,00,000 * 2/10 = ₹3,20,000 Per Share value of C Category equity shares = 3,20,000 / 5000 = ₹64

Topics: Corporate Accounting

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