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Illustration 1A (Computation of the maximum number of equity shares permissible for buyback):
On 31 March, 2022, GILDY & TULSI Ltd. (listed) has, inter alia, the following items with their respective amounts:
Particulars
Rs.in crores
(a)Equity shares of Rs. 10 each fully paid
(b)10% redeemable Preference Shares of Rs. 100 each fully paid-up
330,70 ,90
(c)Securities Premium
240,20,50
(d)General Reserve
(e)Profit and Loss Account
(f)Capital Redemption Reserve Account 1,200
(g)Debt
Based on the above, you are required to compute the maximum permissible number of equity shares that can be bought ba
company has offered the buy-bck price of Rs. 30 per equity share?
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Illustration 1A (Computation of the maximum number of equity shares pe...
Computation of Maximum Permissible Number of Equity Shares for Buyback

1. Calculation of Available Free Reserves:
- General Reserve: Rs. 240 crores
- Profit and Loss Account: Rs. 20 crores
- Capital Redemption Reserve Account: Rs. 50 crores
- Total Available Free Reserves: Rs. 310 crores

2. Determination of Maximum Buyback Amount:
- Maximum Buyback Amount = 25% of the Total of the Free Reserves and Securities Premium Account
- Free Reserves: Rs. 310 crores
- Securities Premium Account: Rs. 240 crores
- Total Free Reserves and Securities Premium Account: Rs. 550 crores
- Maximum Buyback Amount = 25% of Rs. 550 crores = Rs. 137.5 crores

3. Calculation of Maximum Permissible Equity Shares for Buyback:
- Buyback Price per Share: Rs. 30
- Maximum Permissible Number of Equity Shares = Maximum Buyback Amount / Buyback Price per Share
- Maximum Permissible Number of Equity Shares = Rs. 137.5 crores / Rs. 30 = 4.58 crores
Therefore, GILDY & TULSI Ltd. can buy back a maximum of 4.58 crores equity shares at a buyback price of Rs. 30 per share, based on the available free reserves and securities premium account as of 31 March, 2022.
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Illustration 1A (Computation of the maximum number of equity shares permissible for buyback):On 31 March, 2022, GILDY & TULSI Ltd. (listed) has, inter alia, the following items with their respective amounts:ParticularsRs.in crores(a)Equity shares of Rs. 10 each fully paid(b)10% redeemable Preference Shares of Rs. 100 each fully paid-up330,70 ,90(c)Securities Premium240,20,50(d)General Reserve(e)Profit and Loss Account(f)Capital Redemption Reserve Account 1,200(g)DebtBased on the above, you are required to compute the maximum permissible number of equity shares that can be bought ba company has offered the buy-bck price of Rs. 30 per equity share?
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Illustration 1A (Computation of the maximum number of equity shares permissible for buyback):On 31 March, 2022, GILDY & TULSI Ltd. (listed) has, inter alia, the following items with their respective amounts:ParticularsRs.in crores(a)Equity shares of Rs. 10 each fully paid(b)10% redeemable Preference Shares of Rs. 100 each fully paid-up330,70 ,90(c)Securities Premium240,20,50(d)General Reserve(e)Profit and Loss Account(f)Capital Redemption Reserve Account 1,200(g)DebtBased on the above, you are required to compute the maximum permissible number of equity shares that can be bought ba company has offered the buy-bck price of Rs. 30 per equity share? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Illustration 1A (Computation of the maximum number of equity shares permissible for buyback):On 31 March, 2022, GILDY & TULSI Ltd. (listed) has, inter alia, the following items with their respective amounts:ParticularsRs.in crores(a)Equity shares of Rs. 10 each fully paid(b)10% redeemable Preference Shares of Rs. 100 each fully paid-up330,70 ,90(c)Securities Premium240,20,50(d)General Reserve(e)Profit and Loss Account(f)Capital Redemption Reserve Account 1,200(g)DebtBased on the above, you are required to compute the maximum permissible number of equity shares that can be bought ba company has offered the buy-bck price of Rs. 30 per equity share? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Illustration 1A (Computation of the maximum number of equity shares permissible for buyback):On 31 March, 2022, GILDY & TULSI Ltd. (listed) has, inter alia, the following items with their respective amounts:ParticularsRs.in crores(a)Equity shares of Rs. 10 each fully paid(b)10% redeemable Preference Shares of Rs. 100 each fully paid-up330,70 ,90(c)Securities Premium240,20,50(d)General Reserve(e)Profit and Loss Account(f)Capital Redemption Reserve Account 1,200(g)DebtBased on the above, you are required to compute the maximum permissible number of equity shares that can be bought ba company has offered the buy-bck price of Rs. 30 per equity share?.
Solutions for Illustration 1A (Computation of the maximum number of equity shares permissible for buyback):On 31 March, 2022, GILDY & TULSI Ltd. (listed) has, inter alia, the following items with their respective amounts:ParticularsRs.in crores(a)Equity shares of Rs. 10 each fully paid(b)10% redeemable Preference Shares of Rs. 100 each fully paid-up330,70 ,90(c)Securities Premium240,20,50(d)General Reserve(e)Profit and Loss Account(f)Capital Redemption Reserve Account 1,200(g)DebtBased on the above, you are required to compute the maximum permissible number of equity shares that can be bought ba company has offered the buy-bck price of Rs. 30 per equity share? in English & in Hindi are available as part of our courses for B Com. Download more important topics, notes, lectures and mock test series for B Com Exam by signing up for free.
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