Advanced Corporate Accounting 4th Semester B Com

LIQUIDATION OF COMPANIES
Meaning

Liquidation or winding up of companies means the termination of the legal existence of a

company. Under such circumstances, the assets of the company are disposed off and debts are
paid, if any surplus that will be distributed among members in proportion to their holdings.

Types of Winding up / Liquidation

1) Compulsory winding up by the court - It can take place when the company is directed to
be wound-up by an order of court.
2) Voluntary winding up.
a) Member’s voluntary winding up.
b) Creditor’s voluntary winding up.
3) Voluntary winding up under the supervision of the court

Grounds for compulsory winding up

 If the company has, by special resolution, resolved that the company to be wound up by
the court.
 If a default is made in delivering the statutory report of the Registrar of Companies or in
holding the statutory meeting of the company.
 If the company does not commence its business within a year from its incorporation or
suspends its business for a whole year.
 If the number of members falls below seven in case of public company or below two in
case of a private company.
 If the company is unable to pay debts.
 If the court is of opinion that it is just and equitable that the company should be wound
up.

Grounds for voluntary winding up

 By an ordinary resolution:
a) Where the duration of the company was fixed by the articles and the period has
expired, and
b) When the articles provided for winding up on the occurrence of any event and the
specified event has occurred.
 By a special resolution
When a resolution is passed by the members in all other cases for voluntary winding up,
it must be notified to the public by an advertisement in the official gazette and in
newspapers.
1 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

Member’s Voluntary winding up

In a solvent company ( able to pay its debts out of its assets ) directors / members make a
declaration to wind up the company by passing a resolution it is termed as member’s voluntary
winding up.

Creditor’s voluntary winding up

When the declaration of solvency is not made and filed with the registrar, it may be presumed
that the company is insolvent. In that case the company must call a meeting of its creditors for
passing the resolution for winding up.

Voluntary winding up under the supervision of the court

At any time after a company has passed a resolution for voluntary winding up, the court makes
an order that the voluntary winding up shall continue, but subject to such supervision of the
court. This type of liquidation is called Voluntary winding up under the supervision of the court.

Contributory

According to section 428 of the Companies act 2013, a contributory is “Every person liable to
contribute to the assets of a company in the event it’s being wound up, and includes the holder of
any shares which are fully paid up and also any person alleged to be a contributory”.

Liquidator

When there is liquidation of a company, one or more persons are required to be appointed
specially for conducting the liquidation or winding up proceedings of the company, Such a
person / s are called Liquidator / s.

Functions of liquidator

 The primary function of a liquidator is to realize the assets of the company.

 He has to collect money due from the contributories.
 He has to distribute the amount in order as per rule 329 of companies act.
 He has to maintain and submit the record of receipt and payment of cash to the members /
to the court.

Liquidator’s Final Statement of Account

At the time of liquidation of a company, the liquidator realizes all the assets and discharges the
liabilities and capital. The statement prepared to record such receipts and payments is called
“Liquidator’s Final Statement of Account”. This statement is prepared after the affairs of the
company are fully wound-up. The liquidator must make the payment in following order:

2 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

1. Secured creditors.
2. Liquidation expenses.
3. Liquidator’s remuneration.
4. Payment to Debenture holders.
5. Payment to Preferential creditors.
6. Payment to Unsecured creditors.
7. Calls in advance, if any.
8. Arrears of dividends on cumulative preference shares.
9. Amount due to preference shareholders.
10. Amount due to equity shareholders.

Secured Creditors

A “secured creditor” is a creditor that has a lien on an item of its debtor’s property. The lien
gives the secured creditor an interest in its debtor’s property that provides for the property to be
sold to satisfy the debt in cases of default. The secured creditor’s lien can be voluntary like asset-
based lender or involuntary like tax-lien.

Unsecured creditors

An “unsecured creditor” is the one who do not hold a lien on its debtor’s property to assure
payment of its debt, if there is a default. Most credit card issuers, suppliers and cash advance
companies are examples of unsecured creditors.

Preferential creditors

Preferential creditor is a creditor whose right to payment is deemed of more importance than
another. Examples of preferential creditors under section 326 of companies act are as follows:

 All revenues, taxes, cesses and rates due from the company to state or central government
or to a local authority at the relevant date and having become due and payable within the
12 months next before that date.
 All wages or salaries due to employees in respect of service rendered to the company and
due for a period not exceeding 4 months within 12 months next before the relevant date
or any compensation payable to any workman under any provision of Chapter V A of the
Industrial Dispute Act, 1947, provided the amount to any one claimant does not exceed
Rs 20,000.
 Amount due as compensation under workmen’s compensation act 1923, in respect of
death or disablement of any employee of the company.
 Amount due to an employee from provident fund, pension fund and other funds for
welfare of the employees maintained by the company.

3 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

 All accrued holiday remuneration becoming payable to an employee or in the case of his
death, to any other person in his right, on the termination of his employment, before or by
the effect of winding up order or resolution.

Calls on Shares

When the amount available is not sufficient to pay outside liabilities or preference shareholders,
any uncalled amount on equity shares must be called to the extent required at the relevant stage
of deficiency.

Liquidator’s Remuneration

 Fixed amount.
 % on Assets realized (except cash in hand and cash at bank).
 % on Amount realized (total receipts).
 % on payments made to unsecured creditors.
 % on payment made to shareholders

If amount available is sufficient

LR = Amount payable to unsecured creditors x Percentage of commission

100

If amount available is not sufficient

% on payment made to unsecured creditors

LR = Amount available x Percentage of commission

100 + Percentage of commission

% on payment made to shareholders

LR – Amount available to shareholders x Percentage of commission

100 + Percentage of commission

Note – Preferential creditors are treated as a part of unsecured creditors for the purpose of
calculating remuneration only.

4 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

Liquidator’s Final Statement of Account.

Receipts Amount Payment Amount

Cash in hand xxx Secured creditors xxx
Cash at bank xxx Liquidation expenses xxx
Assets Realized : Liquidator’s Remuneration xxx
Marketable Securities xxx Debenture holders
Bills Receivables xxx O/s interest on debentures xxx
Trade Debtors xxx Debentures xxx
Loans and Advances xxx Preferential Creditors xxx
Stock in trade xxx Unsecured creditors xxx
Work in Progress xxx Calls in Advance xxx
Land and Building xxx Preference Shareholders
Plant and Machinery xxx Arrears of Dividend xxx
Furniture and Fixtures xxx Preference Shares capital xxx
Patents, trade marks xxx Equity Shareholders
Investments etc xxx Equity Share Capital xxx
Surplus realized from secured creditors xxx
Calls in Arrears xxx
Amount received from calls on shares xxx

xxx xxx
Problems

1 The following particulars relate to a limited company which has gone into voluntary
liquidation. You are required to prepare the liquidator’s final account allowing for his
remuneration at 2% on the amount realized, 2% on amount distributed to unsecured creditors
other than preferential creditors. The liquidation expenses amounted to Rs 1,000.

Rs

Preferential creditors 10,000

Unsecured creditors 32,000

Debentures 10,000

The assets realized the following sums:

Land and Buildings 20,000

Plant and Machinery 18,650

Furniture and Fittings 1,000

5 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

2 Prakash Limited went into voluntary liquidation as on 31-03-2019. Following information is

available with the liquidator.

Creditors amount to Rs 75,660 out of which Rs 8,000 are preferential, 6% Debentures having a
floating charge on the assets of the company amounted to Rs 80,000. Debentures to be paid
interest up to 30-09-2019

The assets realized are as follows:

Stock Rs 84,000; Plant and Machinery Rs 60,600; Cash in hand stood at Rs 500.

Debentures were paid off on 30-09-2019 with interest. Liquidator’s expenses amounting to Rs
1,902 and he is to be given a remuneration at 3% on the amount realized and 2% on amount
distributed to unsecured creditors excluding preferential creditors. Prepare Liquidator’s Final
Statement of Account.

3 Luckless Limited went into voluntary liquidation on 31-03-2019 when the state of affairs was
as follows:

Unsecured creditors were Rs 4,00,000 including Rs 50,000 preferential claims. Secured

creditors, secured on plant and machinery, stood at Rs 2,00,000. Cash in hand was Rs 10,000.

The liquidator realized plant and machinery for Rs 1,50,000 and the other assets realized Rs
1,00,000. The liquidation expenses came to Rs 10,000 and the liquidator’s remuneration was
fixed at 4% of the amount realized including cash balance and 2% on amount distributed to
unsecured creditors including preferential creditors. Prepare Liquidator’s Final Statement of
Account showing the distribution of cash.

4 Bad Luck Co Ltd went into liquidation. Its assets realized Rs 1,75,000 excluding the amount
realized by sale of securities held by secured creditors. The following was the position:

Share capital: 500 shares of Rs 100 each Rs

Secured creditors (securities realized 20,000) 17,500

Preferential creditors 3,000

Unsecured creditors 70,000

Debentures having a floating charge on the assets of the company 1,25,000

Liquidation expenses 6,250

Liquidator is to be paid a commission of 2% on the amount actually paid unsecured creditors

including preferential creditors. Prepare Liquidator’s Final Statement of Account.

6 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

5 Unfortunate Ltd went into voluntary liquidation on 1-4-2019 on which date its position was as
under:

Rs
Liabilities
Share Capital 2,500 shares of Rs 100 each, Rs 80 per share 2,00,000
paid up
Secured Loan (Land, Building and Machinery) 50,000
Unsecured Loan 95,000
Preferential creditor 5,000
3,50,000

Assets
Land, Building and Machinery 40,000
Other fixed assets 1,30,000
Stock 52,500
Debtors 50,000
Loans 20,000
Cash 2,500
Profit and Loss Account 55,000
3,50,000
Land, Building and Machinery were realized by secured creditors for Rs 60,000. Other fixed
assets realized Rs 20,000, Debtors Rs 10,000 and Stock Rs 5,000. Loans were completely bad.
Liquidator is to be paid a fixed commission of Rs 500 plus 1% of amount paid to unsecured
creditors excluding preferential creditors. Liquidator’s out of pocket expenses amounted to Rs
500. Company decides to make calls on shares and received in full. Prepare Liquidator’s Final
Statement of Account.

6 The following was the Balance Sheet of the Unsound Ltd, as at 31st March 2019 when it was
wound up voluntarily.

Liabilities Rs Assets Rs
50,000 Equity Shares of Rs 10 each 5,00,000 Plant and Machinery 4,00,000
2,000, 6% Cumulative Preference Shares of 2,00,000 Furniture 1,000
Rs 100 each Investments 50,000
7% Debentures 1,00,000 Stock 50,000
Sundry Creditors Debtors 2,00,000
Trade 3,00,000 Cash 1,200
Cash 48,000 Profit and Loss A/c 4,47,800
Outstanding 2,000

11,50,000 11,50,000

7 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

Preference dividends are in arrears for one year. Debenture interest is also due for one year All
the outstanding creditors are preferential. The assets realized as follows:

Rs

Plant and Machinery 2,80,000

Furniture 400

Debtors 1,50,000

The stock and investments realize nothing. The expenses of liquidation amounted to Rs 2,000.
The liquidator is entitled to a commission of 4% on the assets realized and 2% on the amount
paid to unsecured creditors. Prepare the Liquidator’s Statement of Account showing the
compensation paid to the unsecured creditors.

7 The Unlucky Ltd, went into voluntary liquidation on 31-3-2019 on which date the position was
as follows:

Liabilities Rs Assets Rs
5,000 Equity Shares of Rs 100 each Rs 80 4,00,000 Land and
paid up Building 80,000
Loan (secured by mortgage of Land and 1,00,000 Fixed Assets 2,60,000
Building) Stock 1,05,000
Unsecured Liabilities (including Rs 10,000 2,00,000 Debtors 1,00,000
preferential creditors) Loan 40,000
Cash 5,000
P&L Account 1,10,000
7,00,000
7,00,000
Land and Building were realized by secured creditors Rs 1,20,000. Other fixed assets realized Rs
40,000, Debtors Rs 20,000, stock realized Rs 10,000. Loans were wholly bad. Liquidator is
entitled to a fixed remuneration of Rs 1,000 plus 2% on amount paid to unsecured creditors.
Liquidator’s out of pocket expenses amounted to Rs 1,000. Company decided to make calls on
shares and received the same in full. Show the Liquidator’s Statement of Account.

8. Jyothi Limited went into voluntary liquidation on 31 st March 2019 on which date the position
of the company was as follows:

2,000 Preference Shares of Rs 10 each, 5,000 A Equity Shares of Rs 10 each Rs 9 paid. 5,000 B
Equity Shares of Rs 10 each Rs 8 per share paid up. Under the Articles of Association the
Preference shares have priority as to the repayment of capital over Equity shares. Fixed Assets
realized Rs 18,000, Current Assets realized Rs 10,000. The Liquidator called on 5,000 B Equity
Shares holders to pay Re 1 which was duly paid except on 200 shares which was irrecoverable.
8 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

The cost of liquidation amounted to Rs 1,650; Preferential creditors Rs 1,000; Secured creditors
Rs 1,000; and unsecured creditors Rs 6,000. The Liquidator’s remuneration is 12% on the
amount paid to secured and unsecured creditors. Prepare Liquidator’s Final Statement.

9. MN Co, went into voluntary liquidation on 1-4-2019. The liquidator is entitled to

remuneration of 3% on assets realized and 2% on the total final amount distributed to all
shareholders. The following was the position as on 31-03-2019.

Rs

Assets realized (including assets given as security) 5,00,000

Liquidation Expenses 9,000

Creditors (including salaries and wages due, treated as preferential Rs 6,000,

loans of Rs 25,000 for which Assets offered as security realized Rs 18,000) 68,000

5,000, 6% preference shares of Rs 30 each (Dividend paid up to 31-03-2018) 1,50,000

10,000 Equity Shares of Rs 10 each, Rs 9 paid up 90,000

General Reserve 1,20,000

Profit and Loss Account balance 20,000

Under the Articles of Association, the preference shareholders have the right to receive 1/3 of the
surplus remaining after repayment of Equity Share Capital, and any arrears of dividend.

Prepare the Liquidator’s Account, showing necessary calculations and working.

10. The Z Valley Mining Co Ltd, went into voluntary Liquidation as on 1-4-2019 as it mines
reached such a state of depletion, that it became too costly to excavate further minerals. The
liquidator’s remuneration is 3% on realization of assets and 2% on distribution to shareholders.
Following being the position of the company (in liquidation) as at 31-03-2019.

Rs

Cash on realization of assets 5,00,000

Expenses of liquidation 7,000

Unsecured creditors 68,000

5,000, 6% Cumulative Preference Shares of Rs 30 each fully paid 1,50,000

9 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

10,000, Equity Shares of Rs 10 each fully paid 1,00,000

General Reserve as at 31-3-2019 1,24,000

Profit and Loss (Credit Balance on 31-3-2019) 20,000

Dividend on preference shares have been paid up to 31-3-2018 and automatically becomes
payable when profits are available.

11. Hapless Limited went into voluntary liquidation on 30-09-2019. On that date, its Balance
Sheet was as follows:

Liabilities Rs Assets Rs
15,000, 8% Preference Shares 15,000 Machinery 25,000
(Rs 1 each) Stock 18,000
30,000 Equity Shares (Rs 1 each) 30,000 Debtors 14,500
6% Debentures 10,000 Cash 500
Creditors 8,000 P&L Account 5,000
63,000 63,000

The dividends of Preference Shares have been paid up to 31-03-2018. In this case, the preference
shares had the right of getting their capital and arrears of dividend, before any amount is repaid
to equity shareholders.

The Liquidator sold the stock and machinery for Rs 36,500 and collected Rs 14,500 from the
debtors. In addition to the creditors mentioned above, he had to pay preferential creditors by the
way of taxes to the extent of Rs 1,000. The Liquidation expenses were Rs 210.

The Debenture holders were repaid on 30-09-2019 along with interest up to this date.

2% on amount realized by the sale of stock and machinery and collection from debtors and 2%
on amount finally paid to Equity Shareholders was to be the Liquidator’s remuneration.

Prepare Liquidator’s Final Account.

10 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

12. The following is the Balance Sheet of X ltd, as on 31 st March 2019.

Liabilities Rs Assets Rs
4,000, 6% Preference Shares of Rs 4,00,000 Land 2,00,000
100 each Plant 5,00,000
2,000 Equity Shares of Rs 100 each, 1,50,000 Patents 80,000
Rs 75 paid up Stock 1,10,000
6,000 Equity Shares of Rs 100 each, 3,60,000 Debtors 2,20,000
Rs 60 paid up Cash 60,000
5% Debentures 2,00,000 Profit and Loss A/c 2,40,000
Outstanding Debenture Interest 10,000
Creditors 2,90,000

14,10,000 14,10,000

On the date of Balance Sheet the company went into liquidation. The dividends of preference
Shares are in arrears for two years. The arrears are payable on liquidation as per Articles of
Association. The Debentures have a floating charge on the assets of the company. Creditors
include a loan of Rs 1,00,000 secured for mortgage of land. The assets realized are as under:
Land Rs 2,40,000; Plant Rs 4,00,000; Patents Rs 60,000; Stock Rs 1,20,000; Debtors Rs
1,60,000

The expenses of liquidation amounted to Rs 21,800. The liquidator is entitled to get a

commission of 3% on assets realized including cash and a commission of 2% on the amount
distributed to unsecured creditors. Preferential creditors amounted to Rs 30,000. Prepare the
Liquidator’s Statement of Account.

13. Quick Consumption Limited went into voluntary liquidation on 31-03-2019. The Balance
Sheet as on that date was:

Liabilities Rs Assets Rs
Share Capital: Land and Building 2,50,000
5,000, 6% Cumulative Preference Machinery 6,25,000
Shares of Rs 100 each fully paid 5,00,000 Patents 1,00,000
2,500 Equity Shares of Rs 100 each, Stock 1,37,500
Rs 75 paid up 1,87,500 Debtors 2,75,000
7,500 Equity Shares of Rs 100 each, Cash at Bank 75,000
Rs 60 paid up 4,50,000 Profit and Loss A/c 3,00,000
5% Mortgage Debentures 2,50,000
Outstanding Debenture Interest 12,500
Creditors 3,62,500

17,62,500 17,62,500

11 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

The liquidator is entitled to a commission of 3% on all assets realized except cash and 2% on
amount distributed to unsecured creditors.

Creditors include Rs 17,500 for Income-tax due to Government, Rs 5,000 Outstanding Salaries
of employees and an reward of Rs 15,000 made under Workmen’s Compensation Act. It also
includes a loan for Rs 1,25,000 secured by mortgage on Land and Buildings.

The preference dividends are in arrears for two years. The assets realized as follows:

Rs

Land and Building 3,00,000

Machinery 5,00,000

Patents 75,000

Stock 1,50,000

Debtors 2,00,000

Liquidation Expenses 27,250.

Prepare Liquidator’s Final Statement of Account

14. Ram Ltd went into liquidation on 31st March 2019. The Balance Sheet as on that date was:

Liabilities Rs Assets Rs
Share Capital: Freehold Properties 5,80,000
6,000, 5% Cumulative Preference Plant 2,89,000
Shares of Rs 100 each fully paid 6,00,000 Motor Vehicles 57,500
50,000 Equity Shares of Rs 10 each, Stock 1,86,000
fully called 5,00,000 Debtors 74,000
Less: Calls in arrears 25,000 4,75,000 Profit and Loss A/c 2,14,000
------------
Securities Premium Account 50,000
5% Debentures 1,00,000
Outstanding Debenture Interest 2,500
Bank Overdraft 58,000
Creditors (including Preferential 1,15,000
creditors Rs 15,000}
14,00,500 14,00,500

The preference dividends are in arrears for from 1st April 2015. The Company’s Articles provide
for the payment of premium of Rs 12.50 per share along with any arrears of dividend to the
12 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

cumulative preference shareholders in the event of liquidation of the company and payable in
priority to the equity shareholders.

The Bank O/D was guaranteed by the directors who duly implemented their guarantee.

Liquidator realized the assets:

Property Rs 7,00,000; Plant Rs 2,40,000; Motor Vehicles Rs 50,000; Stock Rs 1,50,000; Debtors
Rs 60,000. The Calls in arrears were duly collected by him.

The trade creditors agreed to receive 5% less than their claims. The cost of liquidation was Rs
2,750. The liquidator’s remuneration was 2.5% on the total amount realized and 1% on the
amount paid to unsecured creditors.

Prepare Liquidator’s Final Statement of Account, indicating the amount repaid on each equity
share by the liquidator.

15 The Following is the Balance Sheet of Suma Ltd, as on 31 st March 2019.

Liabilities Rs Assets Rs
Share Capital: Fixed Assets:
1,000 6% Preference Shares of Rs Land and Building 2,00,000
100 each fully paid 1,00,000 Plant and Machinery 2,20,000
2,000, Equity Shares of Rs 100 each, Current Assets
fully paid. 2,00,000 Stock 1,00,000
3,000 Equity Shares of Rs 100 each, Debtors 1,00,000
Rs 50 paid 1,50,000 Cash at Bank 30,000
Secured Loan: Miscellaneous
6% debentures expenditure:
(floating charge on all assets) 1,00,000 Profit and Loss A/c 1,00,000
Others:
(Mortgage on land and building) 1,00,000
Current Liabilities:
Sundry Creditors 90,000
Income tax 10,000

7,50,000 7,50,000

The company went into liquidation on 1-4-2019. The Preference dividends were in arrear for 3
years. The arrears were payable on liquidation.

The assets realized as follows, land and building Rs 2,40,000; plant and machinery Rs 1,80,000;
stock Rs 70,000; debtors Rs 60,000. The expenses of liquidation amounted to Rs 8,000.

13 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

The liquidator is entitled to a commission at 2% on all asserts realized excluding cash at bank
and 3% on amount distributed to unsecured creditors. All payments were on 30 th Sep 2019.
Prepare Liquidator’s Final Statement of Account.

16. The Balance Sheet of Good Luck Limited is as follows for the year ended 31 st March 2019.

Liabilities Rs Assets Rs
8% Preference Share Capital Building(Mortgage for
(2,000 shares of Rs 100 each) 2,00,000 debentures) 2,00,000
5,000 Equity Shares of Rs 100 each, 4,00,000 Other Fixed Assets 6,20,000
Rs 80 paid up Current Assets 2,00,000
8% Mortgage Debentures 2,00,000 Cash 60,000
Outstanding Debenture Interest 16,000 Profit and Loss A/c 2,86,000
Creditors 5,50,000

13,66,000 13,66,000

The Company went into voluntary liquidation and the following transactions took place:

All the assets realized except cash for Rs 9,80,000 by liquidator, including Rs 2,80,000 for the
sale of building as on 01-11-2019.

Liquidation expenses amounted to Rs 20,400.

Liquidator’s Remuneration:

a) 2% on assets realized except cash.

b) 2% on amount paid to creditors.
c) 2% on amount collected by making calls on shares to the required extent only.

Dividends on Preference Shares are in arrears for 4 years and payable on liquidation as per
Articles of the company.

Prepare Liquidator’s Final Statement of Account.

17. A Limited went into voluntary liquidation with the following liabilities:

Rs

Trade Creditors 12,000

Bank Overdraft 20,000

Capital;

10,000 preference shares of Rs 10 each, Rs 7 called up (with prior rights) 70,000

14 Aaminah Firdos
Assistant Professor
BMSCCM
 Advanced Corporate Accounting 4th Semester B Com

10,000 Ordinary Shares of Rs 10 each, Rs 9 called up 90,000

Less: Calls in arrears 2,000 88,000

-----------

Cash received in anticipation of calls;

On preference shares 24,000

On ordinary shares 4,000 28,000

-----------

The assets realized Rs 2,00,000. Expenses on liquidation amounted to Rs 2,000 and liquidator’s
remuneration of Rs 3,000.

Prepare Liquidator’s Final Statement of Account.

15 Aaminah Firdos
Assistant Professor
BMSCCM