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Narain Laxmi Ltd. Invited Applications for Issuing 7,500; 12% Debentures of ₹ 100 Each at a Premium of ₹ 35 per Debenture . - Accountancy

Journal Entry

Narain Laxmi Ltd. invited applications for issuing 7,500; 12% Debentures of ₹ 100 each at a premium of ₹ 35 per debenture . The full amount was payable on application. Applications were received for 10,000 Debentures. Allotment was made to all the applications on pro rata.
Pass necessary Journal entries for the above transactions in the books of Narain Laxmi Ltd.

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Solution

In the Books of Narain Laxmi Ltd.
Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Bank A/c (10,000 debentures × 135)

Dr.

 

13,50,000

 

 

To Debenture Application and Allotment A/c

 

 

 

13,50,000

 

(Application money received on 10,000 12% debenture)

 

 

 

 

 

 

 

 

 

Debenture Application and Allotment A/c

Dr.

 

13,50,000

 

 

To 12% Debentures A/c

 

 

 

7,50,000

 

To Securities Premium Reserve A/c

 

 

 

2,62,500

 

To Bank A/c

 

 

 

3,37,500

 

(7,500; 12% Debentures of Rs 100 each issued at a premium of Rs 35 and excess money refunded)

 

 

 

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APPEARS IN

TS Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 2
Chapter 2 Issue of Debentures
Exercise | Q 4 | Page 52
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