The summarised balance sheet of Owens Ltd at 31 December \(19 \times 9\) was as follows:

A capital reduction scheme has been sanctioned under which the 150,000 preference shares are to be reduced to \(£ 0.75\) each, fully paid, and the 300,000 ordinary shares are to be reduced to \(£ 0.10\) each, fully paid.
Development expenditure and the debit balance on profit and loss account are to be written off, the balance remaining being used to reduce the book value of the plant.
Prepare the journal entries recording the reduction scheme and the balance sheet as it would appear immediately after the reduction. Narrations are not required in connection with journal entries.

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Freehold premises Plant Stock Debtors 60,000 210,000 64,000 70,000 Development expenditure 75,000 Cash at bank 6,000 Profit and loss account 85,000 570,000 Issued capital: 150,000 6 per cent preference shares of 1 each 150,000 300,000 ordinary shares of 1 each 300,000 Creditors 120,000 570,000