Question

Oberoi Ltd. took certain fixed assets for ₹ 6,30,000 from Vikram Ltd. and allotted 6,000, 12% Debentures at a premium of 5% to satisfy the purchase consideration. The Company then issued a prospectus inviting the public to subscribe to ₹ 20,000, 11% Debentures of ₹ 100 each at a discount of 2%, payable as ₹ 35 on application, ₹ 23 on allotment and the balance on first and final call. 

    Applications were received for 16,000 debentures only. All the applications were accepted and money received except first and final call on 100 debentures. Prepare the Cash Book and the Journal.

Answer 1

In the books of Oberoi Ltd.
Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1.	Fixed Assets A/c   ...Dr.		6,30,000	-
	To Vikram Ltd.		-	6,30,000
	(Being fixed assets purchased.)
2.	Vikram Ltd. A/c   ...Dr.		6,30,000	-
	To 12% Debentures A/c (6,000 × 100)		-	6,00,000
	To Securities Premium A/c (6,000 × 5)		-	30,000
	(Being 6,000 12% Debentures @ ₹105 issued at 5% premium.)
3.	11% Debenture Application A/c   ...Dr.		5,60,000	-
	To 11% Debentures A/c (16,000 × 35)		-	5,60,000
	(Being debenture application money transferred.)
4.	11% Debenture Allotment A/c   ...Dr.		3,68,000	-
	Discount on Issue of Debentures A/c (16,000 × ₹2)   ...Dr.		32,000	-
	To 11% Debentures A/c (16,000 × ₹25)		-	4,00,000
	(Being debenture allotment due.)
5.	11% Debenture First & Final Call A/c   ...Dr.		6,40,000	-
	To 11% Debentures A/c (16,000 × ₹40)		-	6,40,000
	(Being debenture call due.)
6.	Calls in Arrears A/c   ...Dr.		4,000	-
	To Debenture First and Final Call		-	4,000
	(Being call money not received on 100 debentures)
7.	Securities Premium A/c   ...Dr.		30,000	-
	Statement of Profit & Loss A/c   ...Dr.		2,000	-
	To Discount on Issue of Debentures A/c		-	32,000
	(Being discount written off.)

 

Dr.	Cash Book A/c (Bank Column)		Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
To Balance b/d	15,64,000	By Balance c/d	31,28,000
To 11% Debenture Application A/c	5,60,000
To 11% Debenture Allotment A/c	3,68,000
To 11% Debenture First & Final Call A/c	6,36,000
Total	31,28,000	Total	31,28,000