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प्रश्न
Tata Motors Ltd. issued 40,000;7% Debentures of ₹ 100 each on 1st July,2009 redeemable at premium of 5% as under:
On 31st March,2015 16,000 Debentures
On 31st March,2016 16,000 Debentures
On 31st March,2017 8,000 Debentures
It was decided to transfer amount out of profit to Debentures Redemption Reserve ₹ 2,00,000 on 31st March, 2012; ₹ 4,00,000 on 31st March , 2013 and balance on 31st March, 2014. It invested the required amount in terms of the Companies Act, 2013 in Government Securities and decided to realise them after last redemption . Paas journal entries ignoring interest .
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उत्तर
Books of Tata Motors Ltd.
Journal
|
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
||
|
2009 |
|
|
|
|
||
|
July 01 |
Bank A/c |
Dr. |
|
40,00,000 |
|
|
|
|
To Debenture Application A/c |
|
|
40,00,000 |
||
|
|
(Debenture application money received) |
|
|
|
||
|
|
|
|
|
|
||
|
|
Debenture Application A/c |
Dr. |
|
40,00,000 |
|
|
|
|
Loss on Issue of Debentures A/c |
Dr. |
|
2,00,000 |
|
|
|
|
To 7% Debentures A/c |
|
|
40,00,000 |
||
|
|
To Premium on Redemption A/c |
|
|
2,00,00 |
||
|
|
(40,000 7% Debenture of Rs 100 each issued) |
|
|
|
||
|
|
|
|
|
|
||
|
2012 |
|
|
|
|
||
|
March 31 |
Statement of Profit and Loss |
Dr. |
|
2,00,000 |
|
|
|
|
To Debenture Redemption Reserve A/c |
|
|
2,00,000 |
||
|
|
(Surplus amount is transferred to Debenture Redemption Reserve) |
|
|
|
||
|
|
|
|
|
|
||
|
2013 |
|
|
|
|
||
|
March 31 |
Statement of Profit and Loss |
Dr. |
|
4,00,000 |
|
|
|
|
To Debenture Redemption Reserve A/c |
|
|
4,00,000 |
||
|
|
(Surplus amount is transferred to Debenture Redemption Reserve) |
|
|
|
||
|
|
|
|
|
|
||
|
2014 |
|
|
|
|
||
|
March 31 |
Statement of Profit and Loss |
Dr. |
|
4,00,000 |
|
|
|
|
To Debenture Redemption Reserve A/c |
|
|
4,00,000 |
||
|
|
(Surplus amount is transferred to Debenture Redemption Reserve) |
|
|
|
||
|
|
|
|
|
|
||
|
April 30 |
Debenture Redemption Investment A/c |
Dr. |
|
2,40,000 |
|
|
|
|
To Bank A/c |
|
|
2,40,000 |
||
|
|
(Investment is made in specified securities equal to 15% of the value of debentures redeemed on March 31, 2014) |
|
|
|
||
|
2015 |
|
|
|
|
||
|
March 31 |
7% Debenture A/c |
Dr. |
|
16,00,000 |
|
|
|
|
Premium on Redemption A/c |
Dr. |
|
80,000 |
|
|
|
|
To Debentureholders’ A/c |
|
|
16,80,000 |
||
|
|
(16,000 7% Debenture of Rs 100 each due for redemption along 5% Premium on redemption) |
|
|
|
||
|
|
|
|
|
|
||
|
March 31 |
Debenture holders |
Dr. |
|
16,80,000 |
|
|
|
|
To Bank A/c |
|
|
16,80,000 |
||
|
|
(Amount paid to debenture holders) |
|
|
|
||
| March 31 |
Debenture Redemption Reserve A/c Dr. |
4,00,000 | ||||
| To General Reserve | 4,00,000 | |||||
| (Debenture Redemption Reserve transferred to General Reserve) | ||||||
| April 30 | Debenture Redemption Investment A/c Dr. | 2,40,000 | ||||
| To Bank A/c | 2,40,000 | |||||
| (Investment is made in specified securities equal to 15% of the value of debentures redeemed on March 31, 2015) | ||||||
|
|
|
|
|
|
||
|
2016 |
|
|
|
|
||
|
March 31 |
7% Debenture A/c |
Dr. |
|
16,00,000 |
|
|
|
|
Premium on Redemption of Debentures A/c |
Dr. |
|
80,000 |
|
|
|
|
To Debenture holders |
|
|
16,80,000 |
||
|
|
(16,000 7% Debentures of Rs 100 each due for redemption along with 5% premium on redemption) |
|
|
|
||
|
|
|
|
|
|
||
|
March 31 |
Debentureholders’ A/c |
Dr. |
|
16,80,000 |
|
|
|
|
To Bank A/c |
|
|
16,80,000 |
||
|
|
(Amount paid to debenture holders) |
|
|
|
||
| March 31 |
Debenture Redemption Reserve A/c Dr. |
4,00,000 | ||||
| To General Reserve | 4,00,000 | |||||
| (Debenture Redemption Reserve transferred to General Reserve) | ||||||
| April 30 | Debenture Redemption Investment A/c Dr. | 1,20,000 | ||||
| To Bank A/c | 1,20,000 | |||||
| (Investment is made in specified securities equal to 15% of the value of debentures redeemed on March 31, 2016) | ||||||
|
|
|
|
|
|
||
|
2017 |
|
|
|
|
||
|
March 31 |
7% Debenture A/c |
Dr. |
|
8,00,000 |
|
|
|
|
Premium on Redemption of Debentures A/c |
Dr. |
|
40,000 |
|
|
|
|
To Debenture holders |
|
|
8,40,000 |
||
|
|
(8,000 7% Debentures of Rs 100 each due for redemption along with 5% premium on redemption) |
|
|
|
||
|
|
|
|
|
|
||
|
March 31 |
Debentureholders’ A/c |
Dr. |
|
8,40,000 |
|
|
|
|
To Bank A/c |
|
|
8,40,000 |
||
|
|
(Payment made to debenture holders) |
|
|
|
||
|
|
|
|
|
|
||
|
March 31 |
Bank A/c |
Dr. |
|
6,00,000 |
|
|
|
|
To Debenture Redemption Investment A/c |
|
|
6,00,000 |
||
|
|
(Investment made in securities, now encashed) |
|
|
|
||
|
|
|
|
|
|
||
|
March 31 |
Debenture Redemption Reserve A/c |
Dr. |
|
2,00,000 |
|
|
|
|
To General Reserve A/c |
|
|
2,00,000 |
||
|
|
(Debenture Redemption Reserve transferred to General Reserve) |
|
|
|
||
Working Note:
WN 1 Calculation of amount of DRR
| Amount for DRR (25 % of Debentures Issued) `= 40,00,000 xx 25/100` = | Rs 10,00,000 |
| Less : Amount transferred in 2012 | Rs 2,00,000 |
| Less : Amount transferred in 2013 | Rs 4,00,000 |
| Amount transferred in 2014 | Rs 4,00,000 |
संबंधित प्रश्न
State the provisions of the Companies Act, 2013 for the creation of 'Debenture Redemption Reserve'.
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.
Star Ltd. is a manufacturer of chemical fertilisers. Its annual turnover is ₹ 50 crores. The company had issued 5,000, 12% Debentures of ₹ 500 each at par. Calculate the amount of Debentures Redemption Reserve which needs to be created to meet the requirements of law.
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.
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.
Apollo Ltd.issued 21,000; 8% Debentures of ₹ 100 each on 1st April, 2013 redeemable at a premium of 8% on 30th June, 2019. The company decided to transfer the required amount to Debentures Redemption Reserve in three equal annual instalments starting with 31st March, 2017. Required investment was made in Government Securities on 30th April, 2019. Ignore interest on debentures and also investment.
Pass necessary Journal entries regarding issue, transfer to DRR, investment, and redemption 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.
'Ananya Ltd.' had an authorised capital of ₹ 10,00,00,000 divided into 10,00,000 equity shares of ₹ 100 each. The company had already issued 2,00,000 shares. The dividend paid per share for the year ended 31st March,2007 was ₹ 30 . The management decided to export its products to African countries . To meet the requirements of additional funds, the finance manager put up the following three alternate proposals before the Board of Directors:
(a) Issue 47,500 equity shares at a premium of ₹ 100 per share .
(b) Obtain a long-term loan from bank which was available at 12% per annum.
(c) Issue 9% Debentures at a discount of 5%.
After evaluating these alternatives , the company decided to issue 1,00,000,9% Debentures on 1st April,2008. The face value of each debentures was ₹ 100 . These debentures were redeemable in four installments starting from the end of third year, which were as follows:
| Year | III | IV | V | VI |
| Amount (₹) | 10,00,000 | 20,00,000 | 30,00,000 | 40,00,000 |
Prepare 9% Debenture Account form 1st April, 2008 till all the debentures were redeemed.
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 :
Relay Ltd. (an unlisted Non NBFC) redeems its 8,000, 10% Debentures of ₹ 100 each in instalments as follows:
| Date of Redemption | Debentures to be redeemed |
| 31st March, 2019 | 2,000 |
| 31st March, 2020 | 5,000 |
| 31st March, 2021 | 1,000 |
On the basis of the above details, what will be the amount of Debenture Redemption Reserve which the company will transfer to General Reserve on 31st March, 2021?
Sunrise Ltd. a listed NBFC, had outstanding 20,000, 7% Debentures of ₹ 100 each, due for redemption on 31st March, 2022.
As per the provisions of the Companies Act, 2013, what amount, if any, does the company need to transfer to Debenture Redemption Reserve, before it can redeem the debentures?
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)
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:
- General Reserve Account.
- Debenture holders’ Account. (Ignore interest on Debentures).
