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Ktr Ltd., Issued 365, 9% Debentures of `1,000 Each on 4-3-2016. Pass Necessary Journal Entries for the Issue of Debentures in the Following Situations - CBSE (Arts) Class 12 - Accountancy

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Question

KTR Ltd., issued 365, 9% Debentures of `1,000 each on 4-3-2016. Pass necessary journal entries for the issue of debentures in the following situations:

(a) When debentures were issued at par redeemable at a premium of 10%.

(b) When debentures were issued at 6% discount redeemable at 5% premium.

Solution

                                                                                     Journal

Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)

(a)

 

 

 

 

 

 

 

 

 

(b)

 

 

 

 

 

 

 

 

Bank A/c (365 x Rs.1000)                                                                               Dr

               To Debenture Application A/c

(Being debenture application money received)

 

Debenture Application A/c                                                                               Dr

Loss on Issue of Debentures A/c (365 x Rs.100)                                                Dr

           To 9% Debentures A/c

           To Premium on Redemption of Debentures A/c (365 x Rs.100)

(Being debentures issued at par, redeemable at premium)

 

Bank A/c (365 x Rs.940)                                                                                 Dr

              To Debenture Application A/c

(Being debenture application money received)

 

Debenture Application A/c                                                                               Dr

Loss on Issue of Debenture A/c (365 x Rs.110)                                                  Dr

                To 9% Debentures A/c

                To Premium on Redemption of Debenture A/c (365 x Rs.50)

(Being debenture issued at discount redeemable at a premium)

 

 

3,65,000

 

 

 

3,65,000

36,500

 

 

 

 

3,43,100 

 

 

 

3,43,100 

40,150 

 

 

 

 

 

3,65,000

 

 

 

 

3,65,000

36,500

 

 

 

3,43,100 

 

 

 

 

 

3,65,000 

18,250 

 

  Is there an error in this question or solution?

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Solution Ktr Ltd., Issued 365, 9% Debentures of `1,000 Each on 4-3-2016. Pass Necessary Journal Entries for the Issue of Debentures in the Following Situations Concept: Issue of Debentures with Terms of Redemption.
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