Day_2_Class Exercise 2011

Q-1 Balance Sheet as on 31st March 2009 ( in 000) Sources A B Assets Share Capital (10) 200 100 Fixed Assets Reserve & Surplus 100 65 Stock 12% Debentures 50 0 Bank Sundry creditors 100 250 Debtors Bills Payable 40 29 490 444

A 250 20 160 60 490

B 190 30 144 80 444

Following Additional Information is Provided-: y y Altd. Acquired 80% of the control on 01.4.2009 at Rs.800 Purchase consideration discharged in one of the following ways: o Cash fully o Issue of shares at market price of 50 o Issue of Convertible debentures of 100 issued at a premiumof 100

Q-2 Balance Sheet as on 31st March 2009 ( in 000) Sources Share Capital (10) Reserve & Surplus 12% Debentures Sundry creditors Bills Payable A 500 250 125 250 100 1225 B 50 300 50 50 30 480 Assets Fixed Assets Stock Cash Debtors R&D A 625 50 400 150 1225 B 100 30 144 80 126 480

y y y

A acquires: 75% stake in B at the market price of share Purchase consideration was discharged by issue of shares at the market price The following is the Market Value of the assets and liabilities of B ltd. on 1.04.2010. o Fixed Assets 85 o Stock 25 o Debtors :70 o R&D: 200 Market prices of shares: A = 20 and B = 50