Question

On January 01, 2025 Ritu Ltd. Issued ₹ 40,00,000, 8% Debentures of ₹ 100 each at 5% discount to be redeemed at 10% premium at the end of 5 years. Balance in Securities Premium on the date of such issue was of ₹ 2,70,000. Pass entries for Issue of debentures.

Answer 1

Journal entries in the books of Ritu Ltd.
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
Jan. 01 2025	Bank A/c   ...Dr.		38,00,000	-
	To Debentures Application and Allotment A/c		-	38,00,000
	(Being application and allotment money received for debentures)
Jan. 01 2025	Debentures Application and Allotment A/c   ...Dr.		38,00,000	-
	Loss on Issue of Debentures A/c   ...Dr.		6,00,000	-
	To 8% Debentures A/c		-	40,00,000
	To Premium on Redemption of Debentures A/c		-	4,00,000
	(Being Issued ₹ 40,00,000, 8% Debentures of ₹ 100 each at 5% discount to be redeemed at 10% premium)