The ledger balances of X Co. Ltd as on 31.3.2016 was as follows :
Fixed Assets ₹7,00,000; Investments ~ 10,000; Stock and Debtors ₹8,50,000; Preliminary Expenses ₹20,000; Equity Share Capital (60% paid) ₹ 6,00,000; 10% First Debentures ₹ 2,00,000; 12% Second Debentures ₹ 5,00,000; Bank Overdraft ₹ 50,000; Trade Creditors (including Y for ₹ 8,50,000) ₹ 11,50,000; Outstanding Interest for one year on both types of debentures ₹ 80,000. Due to heavy losses, the following scheme of reconstruction was agreed:
(i) to make the existing ₹ 100 equity shares fully paid-up and then reduce them to ₹ 20 each.
(ii) to settle the claims of first debentureholders by issuing 2,000, 13.5% debentures of ₹ 100 each.
(iii) to discharge the claims of the second debentureholders by issuing 15%, 4,000 debentures of ₹ 100 each.
(iv) to pay ₹ 3,00,000 to Y in full settlement of his account.
(v) to allot 15,000 fresh equity shares of ₹ 20 each to discharge the remaining trade creditors.
(vi) market value of investments ₹ 20,000.
(vi) to write-off the fictitious assets and to reduce the fixed assets. Pass journal entries to give effect to the above and prepare post reconstruction Balance Sheet.