a12 Rs. Assets Rs. 7,79,500 9,88,500 Liabilities Reserves and Surplus: Capital Reserve Profit & Loss Secured Loans : 10% Debentures (50+10) Current Liabilities and Provision : Creditors Bank Overdraft 60,00,000 12,70,400 2,00,000 2,81,88,400 2,81,88,400 Rs. Rs. Illustration - 12 A Ltd. agreed to take over B Ltd. as on 1st October, 2008. No Balance Sheet of BLtd. was prepared on that date. Balance Sheets of A Ltd. and B Le as at 31st March, 2008 were as follows: A Ltd. B Ltd. A LA BLtd. Rs. Rs. Share capital: 15,00,000 10,00,000 Fixed Assets 12,50,000 8,75,000 In equity shares Current Assets : of Rs. 10 each Stock 2,37,500 1,87,500 fully paid up Debtors 3,90,000 2,93,750 Reserves and Bank 2,56,000 1,50,000 surplus: Miscellaneous Reserve 4,15,000 2,56,000 Expenditure Profit and Loss 1,87,500 1,50,000 Preliminary Creditors 93,750 75,000 Expenses 25,000 12,500 21,96,250 14,81,000 21,96,250 14,81,000 Additional information available: i) For the six months period from 1st April, 2008, A Ltd. made a profit of Rs. 4,20,000 after writing off depreciation at 10% per annum on its Fixed assets. il) For the same period, B Ltd, made a net profit of Rs. 2,04,000 after writing off depreciation at 10% p.at. on its Fixed assets. iii) Both the companies paid on ist August, 2008 equity dividends of 15%. Tax at 10% on such payments was also paid by each of them. iv) Goodwill of B Ltd. was valued at Rs. 1,20,000, on the date of take-over, stock of B, subject to an abnormal item of Rs. 7,500 to be fully written off would be appreciated by 25% (or purpose of take-over). v) A Ltd. to issue to B's shareholders fully paid equity share of Rs.10 each, on the basis of the comparative intrinsic value of the shares on the take-over date