Question

Amrit Company Limited purchased assets of the value of Rs.  2,20,000 from another company and agreed to make the payment of purchase consideration by issuing 2,000, 10% debentures of Rs. 100 each at a premium of 10%. Record necessary journal entries.

Answer 1

Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1.	Assets A/c   ...Dr.		2,20,000	-
	To Vendor A/c		-	2,20,000
	(Being assets purchased worth ₹ 2,20,000)
2.	Vendor A/c   ...Dr.		2,20,000	-
	To 10% Debentures A/c		-	2,00,000
	To Securities Premium A/c		-	20,000
	(Being issued 2,000 debentures of ₹ 100 each at 10% premium)