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Z Ltd. purchased furniture costing ₹ 2,20,000 from C.D Ltd. The payment was to be made by issue of 9% Preference Shares of ₹ 100 each at a premium of ₹ 10 per share. Pass necessary Journal entries in the books of Z Ltd.

Answer»

ets A/c        ...dr.         2,20,000             To C.D. LTD. A/c                          2,20,000(Assets purchased from C.D. Ltd.)2). C.D. Ltd. A/c        ...dr.      2,20,000    To 9% PREF. share capital A/c             2,00,000    To securities premium A/c                    20,000(being 9%(2000) preferenceshare Rs. 100 each issued atRs. 10 per share)Explanation:Working note of above entries: No. of shares issued: 2,20,000/(100 + 10) = 2000 shares.A journal ENTRY is defined as the record of transactions associated with the business in the ACCOUNTING books. A correctly accounted journal entry includes the date of transaction, the debit amount, and the amount that will be deposited, details of the transaction, along with a specific reference number.This is the first and main book of accounting. Small traders whose number of transactions are LIMITED, they use the journal as a book of initial accounts.Learn more: journal entriesbrainly.in/question/8370405



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