Question

Y Ltd. purchased furniture costing Rs 1,35,000 from AB Ltd. The payment was made by issue of Equity Shares of Rs 10 each at a discount of Re 1 per share. Pass necessary Journal entries in the books of Y Ltd.

Answer 1

Journal of Y Ltd.
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
	Furniture A/c	Dr.		1,35,000
	To AB Ltd.				1,35,000
	(Furniture purchased)
	AB Ltd.	Dr.		1,35,000
	Discount on Issue of Equity Share A/c			15,000
	To Equity Share Capital A/c				1,50,000
	(Issue of 15,000 equity shares of Rs 10 each at a discount of Re 1 per share)