Based on the case study provided, which specific account—and with what amount—must be debited at the time XYZ Ltd. records the acquisition of the business?

1. Calculate the Book Value of Net Assets taken over:
$$\text{Net Assets}=\text{Sundry Assets Taken Over}-\text{Liabilities Taken Over}$$
$$\text{Net Assets}=3,00,000-20,000=\text{Rs. }2,80,000$$
Compare Net Assets with the Purchase Consideration:
$$\text{Purchase Consideration}=\text{Rs. }3,15,000$$
Since the Purchase Consideration ($\text{Rs. }3,15,000$) is greater than the Net Assets ($\text{Rs. }2,80,000$), the excess amount represents payment for the company's reputation, which is debited to Goodwill.
$$\text{Goodwill Amount}=3,15,000-2,80,000=\text{Rs. }35,000$$