Advertisements
Advertisements
Question
Pass necessary Journal entries relating to the issue of debentures for the following:
(a) Issued ₹ 4,00,000; 9% Debentures of ₹ 100 each at a premium of 8% redeemable at 10% premium.
(b) Issued ₹ 6,00,000; 9% Debentures of ₹ 100 each at par, repayable at a premium of 10%.
(c) Issued ₹ 10,00,000; 9% Debentures of ₹ 100 each at a premium of 5%, redeemable at par.
Advertisements
Solution
Journal
|
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
(a) |
Bank A/c |
Dr. |
|
4,32,000 |
|
|
|
To Debenture Application and Allotment A/c |
|
|
|
4,32,000 |
|
|
(Application money received on 4,000 9% Debentures) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Debenture Application and Allotment A/c |
Dr. |
|
4,32,000 |
|
|
|
Loss on Issue of Debenture A/c |
Dr. |
|
40,000 |
|
|
|
To 9% Debentures A/c |
|
|
|
4,00,000 |
|
|
To Securities Premium Reserve A/c |
|
|
|
32,000 |
|
|
To Premium on Redemption of debentures A/c |
|
|
|
40,000 |
|
|
(4,000; 9% Debentures issued at a premium of Rs 8 and redeemable at premium of 10%) |
|
|
|
|
|
|
|
|
|
|
|
|
(b) |
Bank A/c |
Dr. |
|
6,00,000 |
|
|
|
To Debenture Application and Allotment A/c |
|
|
|
6,00,000 |
|
|
(Application money received on 6,000 9% Debentures) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Debenture Application and Allotment A/c |
Dr. |
|
6,00,000 |
|
|
|
Loss on Issue of Debenture A/c |
Dr. |
|
60,000 |
|
|
|
To 9% Debentures A/c |
|
|
|
6,00,000 |
|
|
To Premium on Redemption of Debentures A/c |
|
|
|
60,000 |
|
|
(6,000; 9% Debentures issued at par and redeemable at premium of 10%) |
|
|
|
|
|
|
|
|
|
|
|
|
(c) |
Bank A/c |
Dr. |
|
10,50,000 |
|
|
|
To Debenture Application and Allotment A/c |
|
|
|
10,50,000 |
|
|
(Application money received on 10,000 9%Debentures) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Debenture Application and Allotment A/c |
Dr. |
|
10,50,000 |
|
|
|
To 9% Debentures A/c |
|
|
|
10,00,000 |
|
|
To Securities Premium Reserve A/c |
|
|
|
50,000 |
|
|
(1,000; 9% Debentures issued at a premium of Rs 5) |
|
|
|
|
APPEARS IN
RELATED QUESTIONS
B.Ltd. purchased assets of the book value of Rs 4,00,000 and took over the liability of Rs 50,000 from Mohan Bros. It was agreed that the purchase consideration, settled at Rs,3,80,000, be paid by issuing debentures of Rs 100 each.
What Journal entries will be made in the following three cases, if debentures are issued: (a) at par; (b) at discount; (c) at premium of 10%? It was agreed that any fraction of debentures be paid in cash.
B. Ltd. issued debentures at 94% for Rs 4,00,000 on April 01, 2011 repayable by five equal drawings of Rs 80,000 each. The company prepares its final accounts on March 31 every year.
Indicate the amount of discount to be written-off every accounting year assuming that the company decides to write-off the debentures discount during the life of debentures. (Amount to be written-off: 2012 Rs 8,000; 2013 Rs 6,400; 2014 Rs 4,800; 2015 Rs 2,000; 2016 Rs 1,600).
A Ltd . issued 2,000; 9% Debentures of ₹ 100 each on the following terms:
₹20 on applications ;₹ 20 on allotment ; ₹ 30 on first call ; ₹ 30 on final call.
The public applied for 2,400 debentures. Applications for 1,800 debentures were accepted in full. Applications for 400 debentures were allotted 200 debentures and applications for 200 debentures were rejected . Pass necessary Journal entries .
Bright Ltd. took over the assets of ₹ 6,60,000 and liabilities of ₹ 80,000 of Star Ltd. for an agreed purchase consideration of ₹ 6,00,000 payable 10% in cash and the balance by the issue of 12% Debentures of ₹ 100 each. Give necessary Journal entries in the books of Bright Ltd., assuming that:
Case (a): The debentures are issued at par.
Case (b): The debentures are issued at 20% premium.
Case (c): The debentures are issued at 10% discount.
Pass journal entries in the following cases:
(a) A Co.Ltd. issued ₹40,000; 12% Debentures at a premium of 5% redeemable at par.
(b) A Co.Ltd. issued ₹40,000; 12% Debentures at a discount of 10% redeemable at par.
(c) A Co.Ltd. issued ₹40,000; 12% Debentures at par redeemable at 10% premium.
(d) A Co.Ltd. issued ₹40,000; 12% Debentures at a discount of 5% and redeemable at 5% premium.
(e) A Co.Ltd. issued ₹40,000; 12% Debentures at a premium of 10% redeemable at 110%.
Pass necessary Journal entries for the issue of Debentures in the following cases:
(a) ₹ 40,000; 15% Debentures of ₹ 100 each issued at a discount of 10% redeemable at par.
(b) ₹ 80,000; 15% Debentures of ₹ 100 each issued at a premium of 10% redeemable at a premium of 10%.
XYZ Ltd.issued 5,000 , 10% Debentures of ₹ 100 each on 1st April, 2015 at a discount of 10% redeemable at a premium of 10% after 4 years. Give journal entries for the year ended 31st March, 2016, assuming that the interest was payable half-yearly on 30th September and 31st March. Tax is to be deducted @ 10%.
On 1st April, 2015, V.V.L.Ltd issued 1,000, 9% Debentures of ₹ 100 each at a discount of 6%, redeemable at a premium of 10% after three years. Pass necessary journal entries for the issue of debentures and debenture interest for the year ended 31st March, 2016, assuming that interest is payable on 30th September and 31st March and the rate of tax deducted at source is 10%. The company closes its books on 31st March every year.
On 1st April, 2017, Solar Power Ltd. issued 10,000, 8% Debentures of ₹ 100 each at a discount of 5% redeemable at a premium of 15% at the end of five years. All the debentures were subscribed and allotment was made. The company had balance in Securities Premium Reserve of ₹ 80,000.
Prepare the Balance Sheet (extract) as at 31st March, 2018.
Discount on issue of debentures is shown under the following head in the Balance Sheet?
Which of the following. column indicated in·the statement given below is to be credited?
"Writing off the loss on issue of debentures"
Which of the following is true with regard to 10% Debentures issued at a discount of 20%?
Debentures are considered as ______ equity.
Assertion (A): Debentures saves income tax.
Reason (R): Interest on debenture is tax deductible expenditure.
Which of the following is not a characteristic of Bearer Debentures?
A Ltd. took over the assets of ₹ 6,60,000 and liabilities of ₹ 80,000 of B Ltd. for an agreed purchase consideration of ₹ 6,00,000 payable 10% in cash and the balance by the issue of 15% debentures of ₹ 100 each at 10% discount. The number of debentures to be issued is:
Madhur Ltd. has outstanding 9% debentures of Rs. 50,00,000 redeemable at par on January 01, 2020. Debenture Redemption Reserve of Rs. 2,00,000 on March 31, 2018 and balance of the required amount of DRR was created on March 31, 2019. The company invested in specified securities (DRI) the required amount on April 01, 2019. Debentures were redeemed on the due date. Record necessary journal entries in the books of the company and also prepare the ledger accounts (ignore interest).
X Ltd. had outstanding 20,000 12% debentures of Rs. 100 each redeemable on June 30, 2019. Record necessary journal entries at the time of redemption.
XYZ Ltd. Issued 6,000, 12% Debentures of ? 50 each on April 1, 2014. Interest on these debenture is payable annually 3151 March each year. The debentures are redeemable in four equal installments at end of third, fourth, fifth and sixth year. You are required to pan journal entries at the time of issue and redemption of debentures in the books of the company under following cases:
- Debentures are issued at par and redeemable at par.
- Debentures are issued at a premium of 10% and redeemable at par.
- Debentures are issued at a discount of 10% and redeemable at par.
- Debenture are issued at par but redeemable at a premium of 10%.
- Debentures are issued at a premium of 10% and redeemable at premium of 10%.
- Debenture are issued at a discount of 10% and redeemable at a premium of 10%.
