Question

J Ltd. purchased machinery for ₹ 3,50,000 from K Ltd. on 28.2.2023. ₹ 50,000 were paid to K Ltd. immediately and the balance was paid by issue of 10% debentures of ₹ 3,10,000 in J Ltd. Pass the necessary journal entries including writing off discount on issue of debentures.

Answer 1

In the Books of J Ltd.
Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2023
February 28	Machinery A/c   ...Dr.		3,50,000	-
	To K Ltd.		-	3,50,000
	(Being machinery purchased from K Ltd.)
February 28	K Ltd.   ...Dr.		50,000	-
	To Bank A/c		-	50,000
	(Being Part payment in cash)
February 28	K Ltd. A/c   ...Dr.		3,00,000	-
	Discount on Issue of Debentures A/c   ...Dr.		10,000	-
	To 10% Debentures A/c		-	3,10,000
	(Being Issue of 10% Debentures for the balance)
March 31	Statement of Profit & Loss A/c   ...Dr.		10,000	-
	To Discount on Issue of Debentures A/c		-	10,000
	(Being discount on issue of debentures written off.)