Star Textiles Ltd. purchased assets of Modern Textiles Ltd. as under: Land and Buildings of ₹ 25,00,000 at ₹ 40,00,000; Plant and Machinery of ₹ 10,00,000 for ₹ 7,50,000

Star Textiles Ltd. purchased assets of Modern Textiles Ltd. as under:

Land and Buildings of ₹ 25,00,000 at ₹ 40,00,000; Plant and Machinery of ₹ 10,00,000 for ₹ 7,50,000 and Furniture of ₹ 3,00,000 for ₹ 1,00,000 for purchase consideration of ₹ 45,00,000. Star Textiles Ltd. paid ₹ 3,00,000 in cash and remaining by issue of 9% Debentures of ₹ 500 each at a premium of 5%. Record necessary entries in the books of Star Textiles Ltd.

[Ans. Capital Reserve ₹ 3,50,000; Debentures issued: 8,000 Debentures of ₹ 500 each.]