Following particulars have been extracted from the balance sheet of Sitara Industries Ltd. as on 31 December 2001:

Liabilities and Capital        Amount Rs.

 Authorized capital:   (200,000 ordinary shares of Rs. 10 each) 

Paid-up capital:     (100,000 ordinary shares of Rs. 10 each) 

Reserve Fund            Rs.750000 and 

Profit and Loss A/C  Rs.300000

The Board of Directors recommended issuing bonus share at Rs.15 share of Rs. 10 each for every 50 share held at present. For this purpose equally amount provided from reserve fund and profit and loss A/C.

The Board also recommended issuing right shares of the company @30 shares of Rs.10 each for every 50 shares at the premium of 30% share. The approval of the controller of the capital issue had already been obtained.

Required: 

Make the necessary Journal entries to the effect of recommendation of the board of directors and show how would be effect the Balance Sheet