A.Ltd. issued 50,00,000, 8% Debenture of Rs 100 at a discount of 6% on April 01, 2009 redeemable at premium of 4% by draw of lots as under:
20,00,000 Debentures on March, 2011
10,00,000 Debentures on March, 2013
20,00,000 Debentures on March, 2014
Compute the amount of discount to be written-off in each year till debentures are paid. Also prepare discount/loss on issue of debenture account.
Solution
Loss on issue of debenture = 6% (discount on issue) + 4% (premium on redemption) = 10%
`50,00,000 xx 100 xx 10/100 = 5,00,00,000`
|
At the end of |
Debenture Outstanding |
Ratio |
Loss to be written off every year |
||
|
March 2010 |
50,00,00,000 |
5 |
`5,00,00,000 xx 5/18` |
= |
1,38,88,889 |
|
March 2011 |
50,00,00,000 |
5 |
`5,00,00,000 xx 5/18` |
= |
1,38,88,889 |
|
March 2012 |
30,00,00,000 |
3 |
`5,00,00,000 xx 3/18` |
= |
83,33,333 |
|
March 2013 |
30,00,00,000 |
3 |
`5,00,00,000 xx 3/18` |
= |
83,33,333 |
|
March 2014 |
20,00,00,000 |
2 |
`5,00,00,000 xx 2/18` |
= |
55,55,556 |
|
|
|
18 |
|
|
Rs 5,00,00,000 |
Loss on Issue of Debenture Account
|
Dr. |
|
|
|
|
|
|
Cr. |
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|
Date |
Particulars |
J.F. |
Amount Rs |
Date |
Particulars |
J.F. |
Amount Rs |
|
|
2009 April 01 |
Debenture |
|
5,00,00,000 |
2010 March 31 |
Profit and Loss |
|
1,38,88,889 |
|
|
|
|
|
|
|
Balance c/d |
|
3,61,11,111 |
|
|
|
|
|
5,00,00,000 |
|
|
|
5,00,00,000 |
|
|
2010 April 01 |
Balance b/d |
|
3,61,11,111 |
2011 March 31 |
Profit and Loss |
|
1,38,88,889 |
|
|
|
|
|
|
|
Balance c/d |
|
2,22,22,222 |
|
|
|
|
|
3,61,11,111 |
|
|
|
3,61,11,111 |
|
|
2011 April 01 |
Balance b/d |
|
2,22,22,222 |
2012 March 31 |
Profit and Loss |
|
83,33,333 |
|
|
|
|
|
|
|
Balance c/d |
|
1,38,88,889 |
|
|
|
|
|
2,22,22,222 |
|
|
|
2,22,22,222 |
|
|
2012 April 01 |
Balance b/d |
|
1,38,88,889 |
2013 March 31 |
Profit and Loss |
|
83,33,333 |
|
|
|
|
|
|
|
Balance c/d |
|
55,55,556 |
|
|
|
|
|
1,38,88,889 |
|
|
|
1,38,88,889 |
|
|
2013 April 01 |
Balance b/d |
|
55,55,556 |
2014 March 31 |
Profit and Loss |
|
55,55,556 |
|
|
|
|
|
55,55,556 |
|
|
|
55,55,556 |
|
