Pass necessary journal entries in the following cases
Jay Ltd. redeemed 1,500, 12% debentures of Rs 1,000 each issued at a discount of 10% by converting them into equity shares of Rs 50 each issued at par.
Solution
| Books of Jay Ltd. Journal Entry |
||||
| Date | Particulars | L.F |
Dr. Rs |
Cr. Rs |
|
12% Debenture A/c Dr. To Debenture holder A/c To Discount on issue of Debentures A/c (Being 1,500 12% debenture of Rs 100 each(issued at discount of 10%) due for redemption) |
15,00,000
|
13,50,000 1,50,000
|
||
|
Debenture holder A/c Dr. To Equity share capital A/c (Being payment made to debenture holder by issuing Rs 27,000 equity share of Rs 50 each) |
13,50,000
|
13,50,000
|
||
Working Note:
Number of shares to be issued = `" Amount Payable to Debentureholder"/"Price of a Share"`
Number of shares to be issued = 1350000/50 = 27000 share
