Question
Jai Ltd is taken over by Ray Ltd. All the assets & liabilities are taken over at book value. Ray Ltd is issuing 5 equity
Jai Ltd is taken over by Ray Ltd. All the assets & liabilities are taken over at book value. Ray Ltd is issuing 5 equity shares for 2 shares held at Rs 10 each to Jai Ltd in settlement of purchase consideration. Identify the method of Purchase consideration & compute it. Discuss the entries to be passed in the books of Ray Ltd. Following is the Balance sheet of Jai & Ray Ltd as on 31st March, 2022
| Liabilities | Jai Ltd (RS) | Ray Ltd (RS) | Assets | Jai Ltd (RS) | Ray Ltd (Rs) |
| Equity share Capital | 200000 | 600000 | Land & building | 300000 | 500000 |
| Pref.share capital |
250000 | 100000 | Machinery | 100000 | 200000 |
| Creditors | 50000 | 100000 | Debtors | 40000 | 50000 |
| Cash | 60000 | 50000 | |||
| Total | 500000 | 800000 | Total | 500000 | 800000 |
The answer should be a at least 800 words with calculation part in word format
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