Question

Journalise the transactions given below:

1. A debenture issued at ₹ 95, repayable at ₹ 100.
2. A debenture issued at ₹ 95, repayable at ₹ 105.
3. A debenture issued at ₹ 100, repayable at ₹ 105.
4. A debenture issued at ₹ 105, repayable at ₹ 100.

   The face value of debenture in each of the above cases is ₹ 100.

Answer 1

Case (i):

Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1.	Bank A/c   ..Dr.		95	-
	To Debenture Application & Allotment A/c		-	95
	(Being application money received.)
2.	Debenture Application & Allotment A/c   ..Dr.		95	-
	Discount on Issue of Debenture A/c   ..Dr.		5	-
	To Debenture A/c		-	100
	(Being application money transfer to Debenture A/c.)

Case (ii):

Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1.	Bank A/c   ..Dr.		95	-
	To Debenture Application & Allotment A/c		-	95
	(Being application money received.)
2.	Debenture Application & Allotment A/c   ...Dr.		95	-
	Discount on Issue of Debenture A/c  .....Dr.		5	-
	Loss on Issue of Debentures A/c   ..Dr.		5	-
	To Debenture A/c		-	100
	To Premium on Redemption A/c		-	5
	(Being application money transfer to Debenture A/c.)

Case (iii):

Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1.	Bank A/c   ...Dr.		100	-
	To Debenture Application & Allotment A/c		-	100
	(Being application money received.)
2.	Debenture Application & Allotment A/c   ...Dr.		100	-
	Loss on Issue of Debenture A/c   ...Dr.		5	-
	To Debenture A/c		-	100
	To Premium on Redemption A/c		-	5
	(Being application money transfer to Debenture A/c.)

Case (iv):

Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1.	Bank A/c   ...Dr.		105	-
	To Debenture Application & Allotment A/c		-	105
	(Being application money received.)
2.	Debenture Application & Allotment A/c   ...Dr.		105	-
	To Debenture A/c		-	100
	To Securities Premium A/c		-	5
	(Being application money transfer to Debenture A/c.)