Arts (English Medium) Class 12 - CBSE Question Bank Solutions for Accountancy

Star Ltd. took over the assets of ₹ 6,60,000 and liabilities of ₹ 80,000 of Moon Ltd. for ₹ 6,00,000. Give necessary Journal entries in the books of Star Ltd. assuming that:

Case (1): The purchase consideration was payable 10% in cash and the balance in 5,400; 12% Debentures of ₹ 100 each.

Case (2): The purchase consideration was payable 10% in cash and the balance in 4,500; 12% Debentures of ₹ 100 each issued at 20% premium. 

R Ltd. purchased the assets of S Ltd. for ₹5,00,000. It also agreed to take over the liabilities of S Ltd. amounted to ₹ 2,00,000 for a purchase consideration of ₹2,80,000 . The payment of S Ltd. was made by issue of 9% Debentures of ₹ 100 each at par.
Pass necessary journal entries in the books of R Ltd.

PremierAuto Ltd. purchased assets of the value of ₹ 3,60,000 from Anand Ltd. and made the payment of purchase consideration by issuing 11%. Debentures of ₹ 100 each at a discount of 10%. The number of debentures issued by Premier Auto Ltd. were ______.

Kuber Ltd. purchased assets worth ₹ 10,00,000 and took over liabilities of ₹ 1,00,000 of Amrit Ltd. for a purchase consideration of ₹ 8,00,000. Kuber Ltd. paid ₹ 2,60,000 through a cheque and the balance was settled by issuing 12% debentures of ₹ 100 each at a discount of 10%. Pass necessary journal entries in the books of Kuber Ltd. for the above transactions. 

Neon Ltd. purchased assets worth ₹ 18,00,000 and took over liabilities of ₹ 2,00,000 of Zenith Ltd. for a purchase consideration of ₹ 15,00,000, Neon Ltd. paid the amount by accepting a bill of exchange of 3,00,000 and the balance was settled by issuing 10% debentures of ₹ 100 each at a premium of 20%. Pass necessary journal entries for the above transactions in the books of Neon Ltd.

TRK Ltd. issued 767, 9% debentures of Rs.100 each on 1-1-2016. Pass necessary journal entries for the issue of debentures in the following situations:

(a) When debentures were issued at a discount of 3% and were redeemable at a premium of 7%.

(b) When debentures were issued at a premium of 4% and were redeemable at a premium of 9%.

KTR Ltd., issued 365, 9% Debentures of `1,000 each on 4-3-2016. Pass necessary journal entries for the issue of debentures in the following situations:

(a) When debentures were issued at par redeemable at a premium of 10%.

(b) When debentures were issued at 6% discount redeemable at 5% premium.

On 2.3.2016 L and B Ltd. issued 635, 9% debentures of Rs.500 each. Pass necessary journal entries for the issue of debentures in the following situations:

(a) When debentures were issued at 5% discount, redeemable at 10% premium.

(b) When debentures were issued at 12% premium, redeemable at 6% premium.

VKR Ltd. issued 975; 9% Debentures of Rs 500 each on 4-3-2016. Pass necessary journal entries for the issue of debentures under the following situations :

(a) When debentures were issued at a premium of 10% redeemable at a premium of 6%.

(b) When debentures were issued at a par redeemable at 9% premium.

Pass the necessary journal entries for an issue of 1,000, 7% Debentures of `100 each in the following cases:

1) Issued at 5% premium redeemable at a premium of 10%.

2) Issued at a discount of 5% redeemable at par.

Taneja Constructions Ltd. has an outstanding balance of Rs 5,00,000, 7% debentures of Rs 100 each redeemable at a premium of 10%. According to the terms of redemption, the company redeemed 30% of the above debentures by converting them into shares of Rs 50 each at a premium of 20%. Record the entries for the redemption of debentures in the books of Taneja Constructions Ltd.

Pass the necessary journal entries for the issue of debentures in the following cases:

Rs 30,000, 12% debentures of Rs 100 each issued at a discount of 5% redeemable at par.

Pass the necessary journal entries for the issue of debentures in the following cases:

Rs 60,000, 12% debentures of Rs 100 each issued at a discount of 5% redeemable at Rs 105.

What is meant by ‘Premium on Redemption of Debentures’?

What is meant by redemption of debentures?

What is meant by the redemption of debentures by conversion?

How would you deal with ‘Premium on Redemption of Debentures’?

What is meant by redemption of debentures out of Capital?

What is meant by the redemption of debentures by “Purchase in the Open Market”?

Short Answer Question

Under which head is the ‘Debenture Redemption Reserve’ shown in the Balance Sheet?