Tanu Ltd. and Manu Ltd. carrying on business of similar nature agreed to amalgamate. A new company TM Ltd. is to be formed to which assets and liabilities of the existing companies, with certain exceptions, are to be tra

Tanu Ltd. and Manu Ltd. carrying on business of similar nature agreed to amalgamate. A new company TM Ltd. is to be formed to which assets and liabilities of the existing companies, with certain exceptions, are to be transferred. On 31 st March, 2016, the balance sheets of the two companies were as under: Balance Sheet as on 31 st March, 2016 Particulars Tanu Ltd. (₹) Manu Ltd. (₹) I. EQUITY AND LIABILITIES (1) Shareholders' funds (a) Share capital 3,00,000 1,60,000 (b) Reserves and surplus 2,00,000 40,000 (2) Non-current liabilities (a) 6% Debentures - 1,20,000 (3) Current liabilities (a) Trade payables 1,50,000 64,000 TOTAL 6,50,000 3,84,000 II. ASSETS (1) Non-current assets (a) Fixed assets Freehold property 2,10,000 1,20,000 Plant and machinery 50,000 30,000 (2) Current assets (a) Inventories 1,40,000 1,56,000 (b) Trade receivables 1,64,000 42,000 (c) Cash and cash equivalents 86,000 36,000 TOTAL 6,50,000 3,84,000 Assets and liabilities are to be taken at book value with the following exceptions: Goodwill of Tanu Ltd. and Manu Ltd. is to be valued at ₹1,60,000 and ₹60,000 respectively. Value of freehold property is to be taken at 120% of the book value in case of both the companies. Debentures of Manu Ltd. are to be discharged by issue of 5% debentures of TM Ltd. of such value that earnings of debentureholders are maintained at same level after amalgamation. Trade receivables of Manu Ltd. were realised fully and the trade payables of Manu Ltd. were paid ₹60,000 in full and final settlement of their claims. You are required to Compute the basis on which shares in TM Ltd. will be issued to the shareholders of existing companies, assuming nominal value of each share in TM Ltd. is ₹10.