Question

B. Ltd., a listed company, issued debentures at 94% for Rs. 4,00,000 on April 01, 2011, repayable by five equal drawings of Rs. 80,000 each. The company prepares its final accounts on March 31 every year. Give Journal entries for issues and redemption of debentures.

Answer 1

Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2011
April, 1	Bank A/c   ...Dr.		3,76,000	-
	To Debentures Application and Allotment A/c		-	3,76,000
	(Being the receipt of debenture application money)
April, 1	Debentures Application and Allotment A/c   ...Dr.		3,76,000	-
	Discount on issue of debentures A/c   ...Dr.		24,000	-
	To Debentures A/c		-	4,00,000
	(Being the issue of Debentures at 5% discount)
2012
March, 31	Statement of Profit and Loss A/c  ...Dr.		24,000	-
	To Discount on the issue of Debentures Account		-	24,000
	(Being a discount on the issue of debentures written off)