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प्रश्न
On 1st April 2015, Mayfair Ltd. issued 4,000 9% debentures of ₹ 100 each at a discount of 5% redeemable at a premium of 8%. The debentures were redeemable on 31st March 2019. The company created the necessary minimum amount of debenture redemption reserve and purchased the required amount of debenture redemption investments as per the provisions of Companies Act, 2013.
Pass the necessary journal entries for the redemption of debentures.
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उत्तर
In the books of Mayfair Ltd.
Journal
| Date | Particulars | L.F. |
Debit Amount(₹) |
Credit Amount(₹) |
|
| 2018 |
|
|
|||
| March 31 | Surplus i.e. Balance as per Statement of Profit & Loss A/c | Dr. |
1,00,000 |
|
|
| To Debenture Redemption Reserve A/c |
|
1,00,000 |
|||
| Being 25% of 4,000 debentures transferred to DRR) |
|
|
|||
|
|
|
||||
| 2018 April 30 |
Debenture Reserve Investment A/c | Dr. |
60,000 |
|
|
| To Bank A/c |
|
60,000 |
|||
| (Being Debenture Redemption Investment made at 15% for 4,000 debentures ) |
|
|
|||
|
|
|
||||
| 2019 March 31 |
Bank A/c | Dr. |
60,000 |
|
|
| To Debenture Reserve Investment A/c |
|
60,000 |
|||
| (Being debenture reserve securities matured) |
|
|
|||
|
|
|
||||
| 2019 March 31 |
9% Debenture A/c | Dr. |
4,00,000 |
|
|
| Premium on Redemption A/c | Dr. |
32,000 |
|
||
| To Debenture holder’s A/c |
|
4,32,000 |
|||
| (For amount due on debenture holders) |
|
|
|||
|
|
|
||||
| 2019 March 31 |
Debenture holders A/c | Dr. |
4,32,000 |
|
|
| To Bank A/c |
|
4,32,000 |
|||
|
|
(For debentures paid) |
|
|
||
|
|
|
|
|||
|
2019 March 31 |
Debenture Redemption Reserve A/c | Dr. |
1,00,000 |
|
|
| To General Reserve A/c |
|
1,00,000 |
|||
|
|
(For DRR transferred to General reserve) |
|
|
संबंधित प्रश्न
What is meant by redemption of debentures?
What is meant by redemption of debentures out of Capital?
What is meant by the redemption of debentures by “Purchase in the Open Market”?
Short Answer Question
Under which head is the ‘Debenture Redemption Reserve’ shown in the Balance Sheet?
Explain the guidelines of SEBI for creating the Debenture Redemption Reserve.
Can a company purchase its own debentures in the open market? Explain.
What is meant by the conversion of debentures? Describe the method of such a conversion.
X.Ltd. purchased a Machinery from Y. Ltd. at an agreed purchase consideration of Rs. 4,40,000 to be satisfied by the issue of 12% debentures of Rs. 100 each at a premium of Rs 10 per debenture. Journalise the transactions.
What journal entries will be made in the following cases when company redeems debentures at the expiry of period by serving the notice: (a) when debentures were issued at par with a condition to redeem them at premium; (b) when debentures were issued at premium with a condition to redeem that at par; and (c) when debentures were issued at discount with a condition to redeem them at premium?
Krishna Ltd. had outstanding 20,000, 9% debentures of ₹ 100 each on 1st April 2014. These debentures were redeemable at a premium of 10% in two equal installments starting from 31st March 2018. The company had a balance of ₹ 4,00,000 in Debenture Redemption Reserve on 31st March 2017. Pass necessary journal entries for the redemption of debentures in the books of Krishna Ltd. for the year ended 31st March 2018.
Convertible debentures cannot be issued at a discount if ______.
Profit on cancellation of own debentures is transferred to ______.
No Debenture Redemption Reserve is required for debentures issued by ______.
Debentures can be redeemed out of:
Which of the following is not true about Debenture Redemption Reserve (DRR)?
Sources of finance for the redemption of debentures are ______.
What is the nature of Premium on Redemption of Debenture Account?
