Question

Pass necessary Journal entries relating to the issue of debentures for the following:
(a) Issued  ₹ 4,00,000; 9% Debentures of  ₹ 100 each at a premium of 8% redeemable at 10% premium.
(b) Issued  ₹ 6,00,000; 9% Debentures of ₹ 100 each at par, repayable at a premium of 10%.
(c) Issued ₹ 10,00,000; 9% Debentures of ₹ 100 each at a premium of 5%, redeemable at par.

Answer 1

Journal

Date	Particulars		L.F.	Debit Amount Rs	Credit  Amount Rs
(a)	Bank A/c	Dr.		4,32,000
	To Debenture Application and Allotment A/c				4,32,000
	(Application money received on 4,000 9%  Debentures)
	Debenture Application and Allotment A/c	Dr.		4,32,000
	Loss on Issue of Debenture A/c	Dr.		40,000
	To 9% Debentures A/c				4,00,000
	To Securities Premium Reserve A/c				32,000
	To Premium on Redemption of debentures A/c				40,000
	(4,000; 9% Debentures issued at a premium of Rs 8 and redeemable at premium of 10%)
(b)	Bank A/c	Dr.		6,00,000
	To Debenture Application and Allotment A/c				6,00,000
	(Application money received on 6,000 9% Debentures)
	Debenture Application and Allotment A/c	Dr.		6,00,000
	Loss on Issue of Debenture A/c	Dr.		60,000
	To 9% Debentures A/c				6,00,000
	To Premium on Redemption of Debentures A/c				60,000
	(6,000; 9% Debentures issued at par and redeemable at premium of 10%)
(c)	Bank A/c	Dr.		10,50,000
	To Debenture Application and Allotment A/c				10,50,000
	(Application money received on 10,000 9%Debentures)
	Debenture Application and Allotment A/c	Dr.		10,50,000
	To 9% Debentures A/c				10,00,000
	To Securities Premium Reserve A/c				50,000
	(1,000; 9% Debentures issued at a premium of Rs 5)