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Problem 4: X Ltd. and Y Ltd. were amalgamated on and from 1st April, 2012 and formed a new company Z Ltd. to takeover the business of X Ltd. and Y Ltd. The summarized Balance Sheets of X Ltd. and Y Ltd., as on 31st March, 2012 are as follows: (Rs. in Crores) Liabilities X Ltd. Y Ltd. Assets X Ltd. Y Ltd. Share Capital: Land and Buildings 38 25 Equity share of Rs. 10 each 50 45 Plant and Machinery 24 17 10% Preference shares of 20 14 Investments 10 6 Rs.100 each Revaluation Reserve 10 6 Inventory 15 General Reserve 12 8 Investment Allowance 5 4 Trade Receivable 30 24 Cash at Bank Reserve 16 13 Profit & Loss Account 8 6 15% Debentures of Rs. 100 4 5 each (Secured) Trade payable 31 12 140 100 140 100 22 Additional Information: 1. Z Ltd. will issue 6 equity shares for 10 equity shares of X Ltd. and 2 equity shares for 5 equity shares of B Ltd. The shares are issued @ Rs. 30 each having a face value of Rs. 10 per share. 2. Preference shareholders of two companies are issued equivalent number of 15% preference shares of Z Ltd. at a price of Rs. 120 per share (face value Rs. 100). 3. 15% Debentureholders of X Ltd. and Y Ltd. are discharged by Z Ltd. issuing such number of its 18% Debentures of Rs. 100 each so as to maintain the same amount of interest. 4. Investment allowance reserve is to be maintained for 4 more years. Prepare the Balance Sheet of Z Ltd. after amalgamation. The amalgamation took place in the nature of purchase. (SM) MA