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प्रश्न
Godrej Ltd. has 20,000; 7% Debentures of ₹ 100 each due for redemption on 31st August, 2018. There is a balance of ₹ 3,50,000 in Debentures Redemption Reserve Account as on 31st March, 2016. Investment, as required by the Companies Act, 2013 is made on 1st April, 2017 in fixed deposit bearing interest @ 6% p.a. Bank deducted TDS @ 10% on its maturity which is 31st March, 2018.
Pass Journal entries for redemption of debentures.
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उत्तर
Journal
In the Books of Godrej Ltd.
|
Date |
Particulars |
L.F. |
Debit Amount (₹) |
Credit Amount (₹) |
|
| 2017 | |||||
| Apr. 01 |
Debenture Redemption Investment A/c |
Dr. |
3,00,000 |
||
| To Bank A/c |
3,00,000 |
||||
|
(Investment made in specified securities) |
|||||
|
2018 |
|
|
|
|
|
|
Mar. 31 |
Bank A/c (3,00,000 + 16,200) |
Dr. |
|
3,16,200 |
|
|
|
Tax Payable A/c |
Dr. |
|
1,800 |
|
| To Interest on Debenture Redemption Investment A/c | 18,000 | ||||
| To Debenture Redemeption Investment A/c | 3,00,000 | ||||
| (Investment encashed and interest received) | |||||
|
|
|
|
|
|
|
|
Mar. 31 |
Statement of Profit & Loss A/c |
Dr. |
|
1,50,000 |
|
|
|
To Debenture Redemption Reserve A/c |
|
|
|
1,50,000 |
|
|
(DRR created) |
|
|
|
|
|
Aug. 31 |
7% Debentures A/c |
Dr. |
|
20,00,000 |
|
| To Debentureholders' A/c | 20,00,000 | ||||
|
(Amount on 7% debentures due) |
|||||
|
Aug. 31 |
Debentureholders' A/c |
Dr. |
|
20,00,000 |
|
|
|
To Bank A/c |
|
|
|
20,00,000 |
|
|
(Payment made on redemption of debentures) |
|
|
|
|
|
|
|
|
|
|
|
|
Aug. 31 |
Debenture Redemption Reserve A/c |
Dr. |
|
5,00,000 |
|
|
|
To General Reserve A/c |
|
|
|
5,00,000 |
|
|
(Transfer of Debenture Redemption Reserve to General Reserve) |
|
|
|
|
Working Notes:
Calculation of amount transferred to DRR
|
Amount of DRR (25 % of Debentures) `= 2000000 xx 25/100` = |
500000 |
| Less : Amount already exists in DRR | 350000 |
| DRR to be created for redemption | 150000 |
Note:
1. The year of transfer to DRR and investment has been assumed to be in 2014 in order to maintain consistency with the guidelines issued by Ministry of Corporate Affairs which requires that every company required to create/maintain DRR shall on or before the 30th day of April of each year, deposit or invest, as the case may be, a sum which shall not be less than fifteen percent of the amount of its debentures maturing during the year ending on the 31st day of March next following year. Accordingly, entries for DRR and investment if passed in any of the year then redemption would take place in the following year.
APPEARS IN
संबंधित प्रश्न
Pass the necessary journal entries for the issue and redemption of Debentures in the following cases:
(i) 15,000, 9% Debentures of Rs 250 each issued at 5% premium, repayable at 15% premium.
(ii) 2,00,000, 12% Debentures of Rs 10 each issued at 8% premium, repayable at par.
X Ltd. had Rs 10,00,00 9% debentures due to be redeemed out of profits on 1st October 2009 at a premium of 5%. The company had a
Debentures Redemption Reserve of Rs 4,14,000. Pass necessary journal entries at the time of redemption.
Nirbhai Chemicals Ltd. issued ₹ 10,00,000; 6% Debentures of ₹ 50 each at a premium of 8% on 30th June, 2018 redeemable on 30th June, 2019. The issue was fully subscribed. Pass Journal entries for issue and redemption of debentures. How much amount should be transferred to Debentures Redemption Reserve before redemption of debentures? Also, state how much amount should be invested in specified securities?
IFCI Ltd.(An All India Financial Institution) issued 10,00,000; 9% Debentures of ₹ 50 each on 1st April, 2011 redeemable on 1st April, 2019. How much amount of Debentures Redemption Reserve is required before the redemption of debentures? Also, pass Journal entries for issue and redemption of debentures.
| On 31st March, 2018, W Ltd. had the following balances in its books: | ₹ |
| 9% Debentures | 6,00,000 |
| Debentures Redemption Reserve | 50,000 |
| Surplus,i.e., Balance in Statement of Profit and Loss | 3,00,000 |
On that date, the company decided to transfer ₹ 1,00,000 to Debentures Redemption Reserve. It also decided to redeem debentures of ₹ 3,00,000 on 30th June, 2018.
Pass necessary Journal entries in the books of the company.
India Textiles Corporation Ltd. has outstanding ₹ 50,00,000; 9% Debentures of ₹ 100 each due for redemption on 31st July, 2019. Pass Journal entries for redemption assuming that there is a balance of ₹ 3,00,000 in Debentures Redemption Reserve on the date of redemption.
Manish Ltd. issued ₹ 40,00,000; 8% Debentures of ₹ 100 each on 1st April, 2017. The terms of issue stated that the debentures are to be redeemed at a premium of 5% on 30th June, 2019. The company decided to transfer ₹ 10,00,000 out of profits to Debentures Redemption Reserve on 31st March, 2018 and ₹ 10,00,000 on 31st March, 2019.
Pass Journal entries regarding the issue and redemption of debentures, DRR and Investment without providing for the interest or loss on issue of debentures.
On 1st April, 2016, following were the balances of Blue Bird Ltd.:
| 10% Debentures (redeemable on 30th September, 2017) | ₹ 15,00,000 |
| Debentures Redemption Reserve | ₹ 2,00,000 |
The company met the requirements of the Companies Act, 2013 regarding Debentures Redemption Reserve and Investment and redeemed the debentures.
Pass necessary Journal entries for the above transactions in the books of the company.
Venus Ltd. had 9,000, 9% Debentures of ₹ 100 each due for redemption . These debentures are to be redeemed in 3 equal installments (starting from 31st March,2015) at a premium of 10%. The company had a balance of ₹ 25,000 in the Debentures Redemption Reserve .
Pass necessary entries for redemption of debentures assuming that company transfer the balance of DRR to General Reserve after redeeming all the debentures.
Fill in the blank.
The portion of uncalled capital to be called only in the event of winding up of the company is called ____________.
Choose the appropriate alternative from the given options:
Madura Ltd. decided to redeem its 10,000, 10% debentures of ₹100 each at a premium of 8%. The minimum amount transferred to debenture redemption reserve will be :
What is the maximum amount of debentures which an unlisted company, other than a NBFC and HFC, can redeem out of its capital?
On 1st April, 2017, Gabriel Ltd., a listed company, issued 3,000, 8% Debentures of ₹ 100 each. One-third of the Debentures were redeemed at par on 31st March, 2021 and the remaining two-third on 31st March, 2022. The company paid interest on debentures annually on 31st March.
After meeting the requirements of the Companies Act, 2013, regarding Debenture Redemption Investment, the company redeemed the debentures.
You are required to record necessary journal entries in the books of the company only on 31st March, 2022; including entries for interest on debentures.
On 1st April, 2022, the following balances appeared in the books of Alpha Pvt. Ltd.
| 9% Debentures redeemable on 31st March, 2023, at a premium of 2% | ₹ 50,00,000 |
| Debenture Redemption Reserve | ₹ 5,00,000 |
The Debenture Redemption Investment, which was purchased by the company on 1st April, 2022, was realised at 101% on the date of redemption and the debentures were redeemed on the due date.
You are required to prepare the following accounts for the year 2022-23 in the books of Alpha Pvt. Ltd.
- Debenture holders’ Account.
- Debenture Redemption Investment Account.
On 1st April, 2022, Resorts Ltd. (a listed construction company) had 60,000, 5% Debentures of ₹100 each due for redemption at par on 31st March, 2023.
As per the law, investment was made in a fixed deposit of a bank on 30th April, 2022, earning interest @5% per annum.
Tax @10% was deducted by the bank on the interest.
You are required to pass necessary journal entries in the year of redemption of debentures, including entries for interest on Debenture Redemption Investment. (Ignore the interest on Debentures)
