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Liquidation of companies
Accountancy
Why haven't we mentioned specifically pledged bank overdraft ( Rs.54000) in the outer column and also equity shareholders in the left column ( Rs. 240000)?
Answers (2)
Bank o/d is secured, so the amount realised from assets is available for all the creditors other than those who are already covered by secured/ mortgaged assets. There's no point of writing equity shareholders in the left column as equity shareholders are the last one to receive payment so any positive balance left will be but obvious their profit
We will not mention bank overdraft again as we have paid it in list B and taken the surplus amount . and as far as equity shareholders are concerned whatever remains at the end is given to equity shareholders irrespective of the capital in balance sheet .Hence it is not written on left side
