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X purchased a running business of A for Rs. 12,00,000. In place of cash he discharged the purchase consideration by issue of equity shares of Rs.10 each at a premium of 20%. Find the number of shares to be issued: (a) 120000 (b) 107500 (c) 100000 (d) 8000?
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X purchased a running business of A for Rs. 12,00,000. In place of cas...
Solution:

Calculation of Purchase Consideration

- X purchased a running business of A for Rs. 12,00,000.

Calculation of Premium on Equity Shares

- The equity shares are issued at a premium of 20%.

- Premium on equity shares = (20/100) * 10 = Rs. 2 per share

Calculation of Number of Shares to be Issued

- The purchase consideration is discharged by the issue of equity shares.

- Total value of equity shares issued = Purchase consideration / (Face value + Premium)

- Total value of equity shares issued = 12,00,000 / (10 + 2) = 1,00,000

- Number of shares to be issued = Total value of equity shares issued / Face value

- Number of shares to be issued = 1,00,000 / 10 = 10,000

- Therefore, the number of shares to be issued is 10,000.

Answer: (d) 8000.
Community Answer
X purchased a running business of A for Rs. 12,00,000. In place of cas...
Premium on equity share = 10× 20%= 2
The Value of equity share = 10+ 2= 12
The Number of shares
1200000÷12
=100000
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X purchased a running business of A for Rs. 12,00,000. In place of cash he discharged the purchase consideration by issue of equity shares of Rs.10 each at a premium of 20%. Find the number of shares to be issued: (a) 120000 (b) 107500 (c) 100000 (d) 8000?
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X purchased a running business of A for Rs. 12,00,000. In place of cash he discharged the purchase consideration by issue of equity shares of Rs.10 each at a premium of 20%. Find the number of shares to be issued: (a) 120000 (b) 107500 (c) 100000 (d) 8000? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about X purchased a running business of A for Rs. 12,00,000. In place of cash he discharged the purchase consideration by issue of equity shares of Rs.10 each at a premium of 20%. Find the number of shares to be issued: (a) 120000 (b) 107500 (c) 100000 (d) 8000? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X purchased a running business of A for Rs. 12,00,000. In place of cash he discharged the purchase consideration by issue of equity shares of Rs.10 each at a premium of 20%. Find the number of shares to be issued: (a) 120000 (b) 107500 (c) 100000 (d) 8000?.
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