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Question
Bank of Baroda issued 8,000, 8% Debentures of ₹ 100 each at a premium of 6% on 1st April, 2016 redeemable on 31st March, 2025. Record necessary entries for issue and redemption of debentures.
Journal Entry
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Solution
| Journal Entries | ||||
| Date | Particulars | L/F | Dr. | Cr. |
| 2016 |
||||
| Apr. 1 | Bank A/c ...Dr. | 8,48,000 | - | |
| To 8% Debentures A/c | - | 8,00,000 | ||
| To Securities Premium Reserve A/c | - | 48,000 | ||
| (Being issue of 8,000 8% Debentures of ₹100 each at 6% premium) | ||||
| 2025 | ||||
| Mar. 31 | 8% Debentures A/c ...Dr. | 8,00,000 | - | |
| To Bank A/c | - | 8,00,000 | ||
| (Being redemption of 8,000 debentures at par) | ||||
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