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प्रश्न
XYZ Ltd. Issued 6,000, 12% Debentures of ? 50 each on April 1, 2014. Interest on these debenture is payable annually 3151 March each year. The debentures are redeemable in four equal installments at end of third, fourth, fifth and sixth year. You are required to pan journal entries at the time of issue and redemption of debentures in the books of the company under following cases:
- Debentures are issued at par and redeemable at par.
- Debentures are issued at a premium of 10% and redeemable at par.
- Debentures are issued at a discount of 10% and redeemable at par.
- Debenture are issued at par but redeemable at a premium of 10%.
- Debentures are issued at a premium of 10% and redeemable at premium of 10%.
- Debenture are issued at a discount of 10% and redeemable at a premium of 10%.
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उत्तर
(i) Debentures are issued at par and redeemable at par.
| In the books of XYZ Ltd. Journal Entries |
||||
| Date | Particulars | L.F. | Dr. (Rs.) | Cr. (Rs.) |
| 1. | Bank A/c ...Dr. | 3,00,000 | ||
| To Debenture application and allotment A/c | 3,00,000 | |||
| (Being debenture amount received) | ||||
| 2. | Debenture application and allotment A/c ...Dr. | 3,00,000 | ||
| To 12% Debenture A/c | 3,00,000 | |||
| (Being amount transfer to debenture) | ||||
| 3. | 12% Debenture A/c ...Dr. | 75,000 | ||
| To Debenture holder A/c | 75,000 | |||
| (Being amount transfer to debenture holder) | ||||
| 4. | Debenture holder A/c ...Dr. | 75,000 | ||
| To Bank A/c | 75,000 | |||
| (Being amount paid to debenture holder) | ||||
(ii) Debentures are issued at a premium of 10% and redeemable at par.
| In the books of XYZ Ltd. Journal Entries |
||||
| Date | Particulars | L.F. | Dr. (Rs.) | Cr. (Rs.) |
| 1. | Bank A/c ...Dr. | 3,30,000 | ||
| To Debenture application and allotment A/c | 3,30,000 | |||
| (Being debenture amount received) | ||||
| 2. | Debenture application and allotment A/c ...Dr. | 3,30,000 | ||
| To 12% Debenture A/c | 3,00,000 | |||
| To Securities Premium A/c | 30,000 | |||
| (Being amount transfer to debenture) | ||||
| 3. | 12% Debenture A/c ...Dr. | 75,000 | ||
| To Debenture holder A/c | 75,000 | |||
| (Being amount transfer to debenture holder) | ||||
| 4. | Debenture holder A/c ...Dr. | 75,000 | ||
| To Bank A/c | 75,000 | |||
| (Being amount paid to debenture holder) | ||||
(iii) Debentures are issued at a discount of 10% and redeemable at par.
| In the books of XYZ Ltd. Journal Entries |
||||
| Date | Particulars | L.F. | Dr. (Rs.) | Cr. (Rs.) |
| 1. | Bank A/c ...Dr. | 2,70,000 | ||
| To Debenture application and allotment A/c | 2,70,000 | |||
| (Being debenture amount received) | ||||
| 2. | Debenture application and allotment A/c ...Dr. | 2,70,000 | ||
| Loss on issue of Debenture A/c ...Dr. | 60,000 | |||
| To 12% Debenture A/c | 3,00,000 | |||
| To Premium on Redemption A/c | 30,000 | |||
| (Being amount transfer to debenture) | ||||
| 3. | 12% Debenture A/c ...Dr. | 75,000 | ||
| Premium on Redemption A/c ...Dr. | 7,500 | |||
| To Debenture holder A/c | 82,500 | |||
| (Being amount transfer to debenture holder) | ||||
| 4. | Debenture holder A/c ...Dr. | 82,500 | ||
| To Bank A/c | 82,500 | |||
| (Being amount paid to debenture holder) | ||||
(iv) Debenture are issued at par but redeemable at a premium of 10%.
| In the books of XYZ Ltd. Journal Entries |
||||
| Date | Particulars | L.F. | Dr. (Rs.) | Cr. (Rs.) |
| 1. | Bank A/c ...Dr. | 3,00,000 | ||
| To Debenture application and allotment A/c | 3,00,000 | |||
| (Being debenture amount received) | ||||
| 2. | Debenture application and allotment A/c ...Dr. | 3,00,000 | ||
| Loss on issue of Debenture A/c ...Dr. | 30,000 | |||
| To 12% Debenture A/c | 3,00,000 | |||
| To Premium on Redemption A/c | 30,000 | |||
| (Being amount transfer to debenture) | ||||
| 3. | 12% Debenture A/c ...Dr. | 75,000 | ||
| Premium on Redemption A/c ...Dr. | 7,500 | |||
| To Debenture holder A/c | 82,500 | |||
| (Being amount transfer to debenture holder) | ||||
| 4. | Debenture holder A/c ...Dr. | 82,500 | ||
| To Bank A/c | 82,500 | |||
| (Being amount paid to debenture holder) | ||||
(v) Debentures are issued at a premium of 10% and redeemable at premium of 10%.
| In the books of XYZ Ltd. Journal Entries |
||||
| Date | Particulars | L.F. | Dr. (Rs.) | Cr. (Rs.) |
| 1. | Bank A/c ...Dr. | 3,30,000 | ||
| To Debenture application and allotment A/c | 3,30,000 | |||
| (Being debenture amount received) | ||||
| 2. | Debenture application and allotment A/c ...Dr. | 3,30,000 | ||
| Loss on issue of Debenture A/c ...Dr. | 30,000 | |||
| To 12% Debenture A/c | 3,00,000 | |||
| To Securities Premium A/c | 30,000 | |||
| To Premium on Redemption A/c | 30,000 | |||
| (Being amount transfer to debenture) | ||||
| 3. | 12% Debenture A/c ...Dr. | 75,000 | ||
| Premium on Redemption A/c ...Dr. | 7,500 | |||
| To Debenture holder A/c | 82,500 | |||
| (Being amount transfer to debenture holder) | ||||
| 4. | Debenture holder A/c ...Dr. | 82,500 | ||
| To Bank A/c | 82,500 | |||
| (Being amount paid to debenture holder) | ||||
(vi) Debenture are issued at a discount of 10% and redeemable at a premium of 10%.
| In the books of XYZ Ltd. Journal Entries |
||||
| Date | Particulars | L.F. | Dr. (Rs.) | Cr. (Rs.) |
| 1. | Bank A/c ...Dr. | 2,70,000 | ||
| To Debenture application and allotment A/c | 2,70,000 | |||
| (Being debenture amount received) | ||||
| 2. | Debenture application and allotment A/c ...Dr. | 2,70,000 | ||
| Discount on issue of Debenture A/c ...Dr. | 30,000 | |||
| To 12% Debenture A/c | 3,00,000 | |||
| (Being amount transfer to debenture) | ||||
| 3. | 12% Debenture A/c ...Dr. | 75,000 | ||
| To Debenture holder A/c | 75,000 | |||
| (Being amount transfer to debenture holder) | ||||
| 4. | Debenture holder A/c ...Dr. | 75,000 | ||
| To Bank A/c | 75,000 | |||
| (Being amount paid to debenture holder) | ||||
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संबंधित प्रश्न
Short Answer Question
What is ‘Capital Reserve’?
Short Answer Question
Name the head under which ‘discount on issue of debentures’ appears in the Balance Sheet of a company.
Journalise the following:
(i) A debenture issued at Rs 95, repayable at Rs 100;
(ii) A debenture issued at Rs 95, repayable at Rs 105; and
(iii) A debenture issued at Rs 100, repayable at Rs 105;
The face value of debenture in each of the above cases is Rs 100.
B. Ltd. issued 1,000, 12% debentures of Rs 100 each on April 01, 2014 at a discount of 5% redeemable at a premium of 10%.
Give journal entries relating to the issue of debentures and debentures interest for the period ending March 31, 2015 assuming that interest is paid half yearly on September 30 and March 31 and tax deducted at source is 10%.
ABC Ltd. issued 40,000; 10% Debentures of ₹ 100 each at par for cash payable in full along with the application. Applications were received for 60,000 debentures . Debentures were allotted and excess application money was refunded. Pass Journal entries in the books of the company.
Raj Ltd . issued 5,000; 8% Debentures of ₹ 100 each at a premium of 5% payable as follows:
₹ 10 on application ; ₹ 20 along with premium on allotment and balance on first and final call.
Pass necessary Journal entries.
Alok Ltd. issued 7,000, 10% Debentures of ₹ 500 each at a premium of ₹ 50 per debenture redeemable at a premium of 10% after 5 years. According to the terms of issue, ₹ 200 was payable on application and balance on allotment.
Record necessary Journal entries at the time of issue of 10% Debentures.
Romi Ltd. acquired assets of ₹ 20 lakhs and took over creditors of ₹ 2 lakhs from Kapil Enterprises.
Romi Ltd. issued 8% Debentures of ₹ 100 each at a discount of 10% as purchase consideration.
Record necessary journal entries in the books of Romi Ltd.
Journalise the following:
(a) A debenture issued at ₹95, repayable at ₹ 100.
(b) A debenture issued at ₹95, repayable at ₹ 105.
(c) A debenture issued at ₹95, repayable at ₹ 105.
The face value of debenture is ₹ 100 in each of the above cases.
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.
Pass necessary Journal entries for the issue of debentures in the following cases:
- ₹ 40,000; 12% Debentures of ₹ 100 each issued at a premium of 5% redeemable at par.
- ₹ 70,000; 12% Debentures of ₹ 100 each issued at a premium of 5% redeemable at ₹ 110.
XYZ Ltd.issued 5,000 , 10% Debentures of ₹ 100 each on 1st April, 2015 at a discount of 10% redeemable at a premium of 10% after 4 years. Give journal entries for the year ended 31st March, 2016, assuming that the interest was payable half-yearly on 30th September and 31st March. Tax is to be deducted @ 10%.
On 1st June, 2017, R Energy Ltd. issued 10,000, 7% Debentures of ₹ 100 each at a discount of 10% redeemable at a premium of 10% at the end of five years. All the debentures were subscribed and allotment was made.
Prepare the Balance Sheet (extract) as at 31st March, 2018.
On 1st April, 2017, Solar Power Ltd. issued 10,000, 8% Debentures of ₹ 100 each at a discount of 5% redeemable at a premium of 15% at the end of five years. All the debentures were subscribed and allotment was made. The company had balance in Securities Premium Reserve of ₹ 80,000.
Prepare the Balance Sheet (extract) as at 31st March, 2018.
Discount on issue of debentures is shown under the following head in the Balance Sheet?
Which of the following situations are commonly found in practice during the issue and redemption of debentures?
A debenture is a ______.
Assertion (A): Debentures saves income tax.
Reason (R): Interest on debenture is tax deductible expenditure.
MK Ltd. has outstanding Rs. 30,000 11% debentures of Rs. 100 each redeemable at 10% premium as follows:
| March 31, 2018 - | 10,000 debentures |
| March 31, 2019 - | 12,000 debentures |
| March 31, 2020 - | Remaining debentures |
Pass necessary journal entries in the books of the company.
