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

Which of the following is a tool of Analysis of Financial Statements?

Under which major heads and sub-heads will the following items be presented in the Balance Sheet of the company as per Schedule III, Part I of the Companies Act, 2013?

1. Bills Receivable
2. Securities premium reserve
3. Calls in advance

Which of the following are not tools of Financial Analysis?

1. Cash Flow Statement
2. Income Statement
3. Balance Sheet
4. Ratio Analysis

It is technique which involves regrouping of data by application of arithmetical relationships. Identify the technique and state any two advantages of the technique identified.

Short Answer Question

State the meaning of ‘Debentures issued as a Collateral Security.

Short Answer Question

What is meant by ‘Issue of debentures for Consideration other than Cash’?

What is meant by ‘Issue of debenture at discount and redeemable at premium’?

Short Answer Question

What is ‘Capital Reserve’?

What is meant by an ‘Irredeemable Debenture’?

Short Answer Question

What is discount on issue of debentures?

Short Answer Question

Name the head under which ‘discount on issue of debentures’ appears in the Balance Sheet of a company.

Long Answer Question

Describe the meaning of ‘Debenture Issued as Collateral Securities’. What accounting treatment is given to the issue of debentures in the books of accounts?

Long Answer Question

How is ‘Discount on Issue of Debentures’ treated in the books of accounts? How will you deal with the ‘discount in issue of debentures’ when the debentures are to be redeemed in instalments?

Long Answer Question

Explain the different terms for the issue of debentures with reference to their redemption.

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.

Journalise the following:

(i) A debenture issued at Rs 95, repayable at Rs 100;

(ii) A debenture issued at Rs 95, repayable at Rs 105; and

(iii) A debenture issued at Rs 100, repayable at Rs 105;

The face value of debenture in each of the above cases is Rs 100.

A.Ltd. issued 50,00,000, 8% Debenture of Rs 100 at a discount of 6% on April 01, 2009 redeemable at premium of 4% by draw of lots as under:

20,00,000 Debentures on March, 2011

10,00,000 Debentures on March, 2013

20,00,000 Debentures on March, 2014

Compute the amount of discount to be written-off in each year till debentures are paid. Also prepare discount/loss on issue of debenture account.

A company issues the following debentures:

1. 10,000 12% debentures of Rs.100 each at par but redeemable at premium of 5% after 5 years;
2. 10,000 12% debentures of Rs.100 each at a discount of 10% but redeemable at par after 5 years;
3. 5,000 12% debentures of Rs.1,000 each at a premium of 5% but redeemable at par after 5 years;
4. 1,000 12% debentures of Rs.100 each issued to a supplier of machinery costing Rs.95,000. The debentures are repayable after 5 years and
5. 300 12% debentures of Rs.100 each as a collateral security to a bank that has advanced a loan of Rs.25,000 to the company for a period of 5 years.

Pass the journal entries to record the issue of debentures.

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).

B. Ltd. issued 1,000, 12% debentures of Rs 100 each on April 01, 2014 at a discount of 5% redeemable at a premium of 10%.

Give journal entries relating to the issue of debentures and debentures interest for the period ending March 31, 2015 assuming that interest is paid half yearly on September 30 and March 31 and tax deducted at source is 10%.