Question

Ronny Ltd. (an unlisted construction company) redeems its 7,000, 10% Debentures of ₹100 each at a premium of 5% in instalments, as follows:

Date of Redemption	Debentures to be redeemed
31st March, 2022	2,000
31st March, 2023	3,000
31st March, 2024	2,000

You are required to prepare for the year 2023-24:

1. General Reserve Account.
2. Debenture holders’ Account. (Ignore interest on Debentures).

Answer 1

Dr.	General Reserve A/c				Cr.
Date	Particulars	Amount (₹)	Date	Particulars	Amount (₹)
2024			2024
Mach 31	To Balance c/d	70,000	April 1	By Balance b/d	50,000
			Mach 31	By DRR	20,000
		70,000			70,000

 

Dr.	Debenture holders’ A/c				Cr.
Date	Particulars	Amount (₹)	Date	Particulars	Amount (₹)
2024			2024
Mach 31	To Bank A/c	2,10,000	Mach 31	By 10% Debentures A/c	2,00,000
			Mach 31	By Premium on Redemption of Debentures A/c	10,000
		2,10,000			2,10,000