Sico Ltd. took over the assets of Rs.  4,80,000 and liabilities of Rs.  80,000 of Mittal Ltd. for a consideration of Rs.  3,20,000. Rs.  20,000 were paid by an acceptance in favour of Mittal Ltd. payable after 3 months and the balance by issue of fully paid up 8% Preference Shares of Rs.  100 each at a premium of 50%. Pass the necessary journal entries for the above transactions in the books of Sico Ltd.

Marks-3, CBSE:2016-17/Comp-AI/Q-8