Question

Sargam Limited issued 2,000, 9% debentures of ₹ 500 each at a premium of 10%. The amount was payable as follows:

On Application - ₹ 200 per debenture

On Allotment - Balance (including premium)

The debentures were fully subscribed and all amounts were duly received.

Pass the necessary journal entries for issue of debentures in the books of Sargam Limited.

Answer 1

In the Books of Sargam Limited Journal
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
	Bank A/c    ...Dr.		4,00,000	-
	To Debenture Application A/c		-	4,00,000
	(Being amount received on application)
	Debenture Application A/c    ...Dr.		4,00,000	-
	To 9% Debentures A/c		-	4,00,000
	(Being application money transferred to 9% Debentures Account)
	Debenture Allotment A/c    ...Dr.		7,00,000	-
	To 9% Debentures A/c		-	6,00,000
	To Securities Premium A/c		-	1,00,000
	(Being allotment money due)
	Bank A/с    ...Dr.		7,00,000	-
	To Debenture Allotment A/c		-	7,00,000
	(Being allotment money received)