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Question
Pass necessary journal entries in the books of Z Ltd. for the following transaction:
The company has a balance of ₹ 60,000 in securities premium reserve account. Loss on issue of debentures ₹ 1,00,000 was written off as per the provisions of the Companies Act. 2013.
Journal Entry
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Solution
| In the books of Z limited Journal Entries |
||||
| Date | Particular | L.F. | Dr. (₹) | Cr. (₹) |
| Securities Premium Reserve A/c ...Dr. | 60,000 | - | ||
| Statement of Profit & Loss ...Dr. | 40,000 | - | ||
| To Loss on Issue of Debentures A/c | - | 1,00,000 | ||
| (Being loss on issue of debentures written off first securities by Premium Reserve then by Statement of Profit of Loss.) | ||||
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