Solve the following with necessary workings or calculation The Balance Sheet of the Premier Co. Ltd. is as follows: Balance Sheet of Premier Co. Ltd. as at 31st March, 2018 I. EQUITY AND LIABILITIES Particulars (1) (1) Shareholders' Funds: (a) Share Capital (b) Reserves and Surplus- General Reserve Profit and Loss Account Staff Welfare Fund (2) Share Application Money Pending Allotment: (3) Non-current Liabilities: (a) Long-term Borrowings-6% Debentures (4) Current Liabilities: TOTAL (a) Short-term Borrowings (b) Trade Payables Sundry Creditors II. ASSETS (1) Non-current Assets : (a) Fixed Assets (i) Tangible Assets - Buildings Plant I Note: Amount No. () (2) (3) (1) 2,50,000 15,000 (45,000) 10,000 30,000 45,000 3,05,000 1,20,000 40,000 Plant II 48,000 (ii) Intangible Assets - Goodwill 25,000 Intangible Assets Goodwill (2) Current Assets : TOTAL (a) Current Investments (b) Inventories (c) Trade Receivables - Sundry Debtors (d) Cash and Cash Equivalents-Cash at Bank Notes to Accounts: (1) Share Capital Particulars Issued, Subscribed and Paid-up Capital: 30,000 Equity Shares of 10 each, 5 per share paid-up 20,000, 7% Preference Shares of 5 each fully paid 25,000 20,000 15,000 30,000 7,000 3,05,000 1,50,000 1,00,000 2,50,000 As the company has been making losses for some time and the financial prospects seem to be unfavourable under its present financial setup, you are required to draw up a scheme of financial reorganisation, involving capital reduction. Show the new Balance Sheet of the company on the assumption that your scheme is given effect to. The following are certain relevant facts that may be considered in drawing up the scheme: (a) Investments are valued at 25,000 in the market. (b) Preference Shares are cumulative and preferential as regards dividend as well as capital. (c) The company needs to have liquid resources of 15,000 for working capital purposes. (d) Bad Debts are estimated at 1,500. (e) Plant II, which was acquired after the issue of Debentures, is not put to proper use due to the retirement of a skilled engineer, who could not be replaced. The market value of Plant II is 5% below book value