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T.S. Grewal solutions for Class 12 Accountancy chapter 2 - Issue of Debentures

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T.S. Grewal T S Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 2

T S Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 2 - Shaalaa.com

Chapter 2: Issue of Debentures

Exercise

Chapter 2: Issue of Debentures Exercise Exercise solutions [Pages 51 - 57]

Exercise | Q 1 | Page 51

Vishwas Ltd. issued 2,000; 9% Debentures of ₹ 100 each payable as follows:
₹ 25 on application; ₹ 25 on allotment and ₹ 50 on first and final call.
Applications were received for all the debentures along with the application money did allotment was made . Call money was also received on the due date.
Pass necessary Journal entries in the books of the company.

Exercise | Q 2 | Page 51

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 .  

Exercise | Q 3 | Page 51

ABC Ltd. issued 40,000; 10% Debentures of ₹ 100 each at par for cash payable in full along with the application. Applications  were received for 60,000 debentures . Debentures were allotted and excess application money was refunded. Pass Journal entries in the books of the company. 

Exercise | Q 4 | Page 52

Narain Laxmi Ltd. invited applications for issuing 7,500; 12% Debentures of ₹ 100 each at a premium of ₹ 35 per debenture . The full amount was payable on application. Applications were received for 10,000 Debentures. Allotment was made to all the applications on pro rata.
Pass necessary Journal entries for the above transactions in the books of Narain Laxmi Ltd.

Exercise | Q 5 | Page 52

Raj Ltd . issued 5,000;  8% Debentures of ₹ 100 each at a premium of 5% payable as follows:
₹ 10 on application ; ₹ 20 along with premium on allotment and balance on first and final call.
Pass necessary Journal entries.

Exercise | Q 6 | Page 52

Nipa Limited issued ₹ 10,00,000 Debentures of ₹ 100 each at a premium of 10% , payable 25% on application (including premium) and the balance on allotment . The debentures were applied for and the amount was dully received.
You are required to give Journal entries and prepare Cash Book.

Exercise | Q 7 | Page 52

Alok Ltd. issued 7,000, 10% Debentures of ₹ 500 each at a premium of ₹ 50 per debenture redeemable at a premium of 10% after 5 years. According to the terms of issue, ₹ 200 was payable on application and balance on allotment.
Record necessary Journal entries at the time of issue of 10% Debentures.

Exercise | Q 8 | Page 52

Vijay Laxmi Ltd. invited applications for 10,000; 12% Debentures of ₹ 100 each at a premium of ₹ 70 per debenture .The full amount was payable on application.
Applications were received for 13,500 debentures. Applications for 3,500 debentures were rejected  and application money was refunded . Debentures were allotted to the remaining applications .

Exercise | Q 9 | Page 52

Iron Products Ltd. issued 5,000; 9% Debentures of ₹ 100 each at a premium of ₹ 40 payable as follows;
(i) ₹ 40 , including premium of ₹ 10 on applications;
(ii) ₹ 45, including premium of ₹ 15 on allotment ; and
(iii) Balance as first and final call.
The issue was subscribed and allotment made. Calls were made and due amount  was received .
Pass Journal entries .

Exercise | Q 10 | Page 52

X Ltd . issued 12,000; 8% Debentures of ​₹  100 each at a discount of 5% payable as 25% on application;20% on allotment and balance after three months.
Pass Journal entries. 

Exercise | Q 11 | Page 52

Alka Ltd . issued 5,000, 10% Debentures of ​₹  1,000 each at a discount of 10% redeemable at a premium of 5% after 5 years . According to the terms of issue ​₹  500 was payable  on application and the balance amount on allotment of debentures. Record necessary entries regarding issue of 10% Debentures.

Exercise | Q 12 | Page 52

Amrit Ltd . was promoted by Amrit and Bhaskar with an authorised capital of ​₹  10,00,000 divide into 1,00,000 shares of ​₹  10 each.
The company decided to issue 1,000,6% Debentures of ​₹  100 each to Amrit and Bhaskar  each for their services in incorporating the company.
Pass journal entry.

Exercise | Q 13 | Page 53

Joy Ltd. company bought a Building for ​₹  9,00,000 and the consideration was paid by issuing 10% Debentures of the normal (face) value of ​₹ 100 each at a discount of 10%.

Give Journal entries.

Exercise | Q 14 | Page 53

Wye Ltd . purchased an established business for ​₹  2,00,000 payable as ​₹  65,000 by cheque and the balance by issuing 9% Debentures of ​₹  100 each at a discount of 10%.
Give journal entries  in the books of Wye Ltd.

Exercise | Q 15 | Page 53

Newton Ltd. purchased a Machinery from B for ​₹  5,76,000 to be paid by the issue of 9% Debentures of ​₹  100 each at 4% discount. Journalise the trasactions.

Exercise | Q 16 | Page 53

Reliance Ltd. purchased machinery costing ​₹  1,35,000 . It was agreed that the purchase consideration be paid by issuing 9% Debentures of ​₹  100 each . Assume debentures have been issued
(i) at par and
(ii)at a discount of 10%.
Give necessary journal entries.

Exercise | Q 17 | Page 53

Deepak Ltd purchased furniture of ₹ 2,20,000 from M/s. Furniture Mart. 50% of the amount was paid to M/s. Furniture Mart by accepting a Bill of Exchanged and for the balance the company issued 9% Debenture of ​₹  100 each at a premium of 10% in favour of M/s. Furniture Mart.
Pass Journal entries in the books of Deepak Ltd. 

Exercise | Q 18 | Page 53

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.

Exercise | Q 19 | Page 53

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 (a): The purchase consideration was payable 10% in cash and the balance in 5,400; 12% Debentures of ₹ 100 each.
Case (b): The purchase consideration was payable 10% in cash and the balance in 4,500; 12% Debentures of ₹ 100 each issued at 20% premium. 

Exercise | Q 20 | Page 54

Romi Ltd. acquired assets of  ₹ 20 lakhs and took over creditors of  ₹ 2 lakhs from Kapil Enterprises.
Romi Ltd. issued 8% Debentures  of  ₹ 100 each at a discount of 25% as purchase consideration.
Record necessary journal entries in the books of Romi Ltd.

Exercise | Q 21 | Page 54

Romi Ltd. acquired assets of  ₹ 20 lakhs and took over creditors of  ₹ 2 lakhs from Kapil Enterprises.
Romi Ltd. issued 8% Debentures  of  ₹ 100 each at a discount of 10% as purchase consideration.
Record necessary journal entries in the books of Romi Ltd.

Exercise | Q 22 | Page 54

Exe Ltd. purchased the assets of the book value  ₹4,00,000 and took over the liabilities of ₹ 50,000 from Mohan Bros.It was agreed that the  purchase consideration ,settled at  ₹3,80,000 be paid by issuing debentures  of ₹ 100 each.
Pass journal entries if debenture are issued: 
(a) at par
(b) at a discount of 10% and
(c) at a premium of 10%.
It was agreed that any fraction of debentures be paid in cash.

Exercise | Q 23 | Page 54

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.

Exercise | Q 24 | Page 54

Green Ltd. purchased the assets of Strong Ltd. for ₹ 40,00,000 and took over liabilities of 7,00,000 at an agreed value of ₹ 32,40,000. Payment was made by issuing 10% Debentures of 100 each at a discount of 10%. Pass the necessary Journal entries in the books of Green Ltd.

Exercise | Q 25 | Page 54

Wellbeing Ltd. took over assets of ₹ 9,80,000 and liabilities of ₹ 40,000 of HDR Ltd. at an agreed value of ₹ 9,00,000. Wellbeing Ltd. paid to HDR Ltd. by issue of 9% Debentures of ₹ 100 each at a premium of 20%. Pass necessary Journal entries to record the above transactions in the books of Wellbeing Ltd.

Exercise | Q 26 | Page 54

Grown Ltd. issued 500, 10% Debentures of ₹ 1,000 each credited as fully paid-up to the promoters for their services to incorporate the company. It also issued 100, 10% Debentures of ₹ 1,000 each credited as fully paid-up to the underwriters towards their commission. Pass the Journal entries.

Exercise | Q 27 | Page 55

'Sangam Woollens Ltd.', Ludhiana, are the manufacturers and exporters of woollen garments. The company decided to distribute free of cost woollen garments to 10 villages of Lahaul and Spiti District of Himachal Pradesh. The company also decided to employ 50 young persons from these villages in its newly established factory. The company issued 40,000 Equity Shares of ₹ 10 each and 1,000, 9% Debentures of ₹ 100 each to the vendor for the purchase of machinery of ₹ 5,00,000. Pass necessary Journal entries.

Exercise | Q 28 | Page 55

Best Barcode Ltd. took a loan of  ₹ 5,00,000 from a bank giving  ₹ 6,00,000; 9% Debentures as collateral security. Pass journal entries regarding issue of debentures , if any, and show this loan in the Balance Sheet of the company.

Exercise | Q 29 | Page 55

A company took a loan of  ₹ 4,00,000 from Bandhan Bank Ltd. and issued  8% Debentures of  ₹ 4,00,000 as a collateral security.

Exercise | Q 30 | Page 55

X Ltd. took a loan of  ₹ 3,00,000 from IDBI Bank . The company issued 4,000; 9% Debentures of  ₹ 100 each as a collateral security for the same . Show how these items will be presented in the Balance Sheet of the company. 

Exercise | Q 31 | Page 55

S. Singh Limited obtained a loan of ₹ 5,00,000 from State Bank of India @ 10% p.a. interest. The company issued ₹ 7,50,000, 10% Debentures of ₹ 100 each in favour of State Bank of India as Collateral Security. Pass necessary Journal entries for the above transactions:
(i) When company decided not to record the issue of 10% Debentures as Collateral Security.
(ii) When company decided to record the issue of 10% Debentures as Collateral Security.

Exercise | Q 32 | Page 55

Journalise the following:
(a) A debenture issued at ₹95, repayable at ₹ 100.
(b) A debenture issued at ₹95, repayable at ₹ 105.
(c) A debenture issued at ₹95, repayable at ₹ 105.
The face value of debenture is  ₹ 100 in each of the above cases.

Exercise | Q 33 | Page 55

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%.

Exercise | Q 34 | Page 55

Footfall Ltd. issues 10,000 Debentures of ₹ 100 each at a discount of 10% redeemable at a premium of 5% after the expiry of three years.
Pass Journal entries for the issue of these debentures.

Exercise | Q 35 | Page 55

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.

Exercise | Q 36 | Page 55

Pass necessary Journal entries relating to the issue of  debentures for the following:
(a) Issued  ₹ 28,000; 10% Debentures of  ₹ 100 each at a premium of 15% redeemable at par.
(b) Issued  ₹ 30,000; 10% Debentures of  ₹ 100 each at a premium of 10% and redeemable at a premium of 15%.
(c) Issued  ₹ 80,000; 10% Debentures of  ₹ 100 each at par repayable at a premium of 10%.

Exercise | Q 37 | Page 56

Journalise the following transaction at the time of issue of 12% Debentures:
Nandan Ltd. issued ₹90,000, 12% Debentures of ₹ 100 each at a discount of 5% redeemable at 110%.

Exercise | Q 38 | Page 56

Pass necessary Journal entries for the issue of debentures in the following cases:
(a)  ₹ 40,000; 12% Debentures of  ₹ 100 each issued at a premium of 5% redeemable at par.
(b) ₹ 70,000; 12% Debentures of  ₹ 100 each issued at a premium of 5% redeemable at ₹ 110.

Exercise | Q 39 | Page 56

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%.

Exercise | Q 40 | Page 56

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%. 

Exercise | Q 41 | Page 56

Bright Ltd. issued 5,000; 10% Debentures of  ₹ 100 each on 1st April, 2015 . The issue was fully subscribed . According to the terms of issue, interest on the debentures is payable half-yearly on 30th  September and 31st March and the tax deducted at source is 10%.
Pass necessary journal entries related to the debenture interest for the year ending 31st March , 2016 and transfer of interest on debentures of the year to the Statement of Profit and Loss .

Exercise | Q 42 | Page 56

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. 

Exercise | Q 43 | Page 56

Kitply Ltd.issued  ₹ 2,00,000, 10% Debentures  at a discount of 5% .The terms of issue provide the repayment at the end of 4 years . Kitply Ltd.has a balance of ₹ 5,00,000 in Securities Premium Reserve . The company decided to write off  discount on issue of debentures from Securities Premium Reserve in the first year.
Pass the journal entry.

Exercise | Q 44 | Page 56

A limited company issued ₹ 1,00,000, 9% Debentures at a discount of 6% on 1st April, 2017. These debentures are to be redeemed equally, spread over 5 annual instalments.

Pass the Journal entries for issue of debentures and writing off the discount.

Exercise | Q 45 | Page 56

On 1st January, 2017, Raha Ltd. issued 6,000, 8% Debentures of nominal (face) value of ₹ 100 each redeemable at 5% premium in equal proportions at the end of 5, 10 and 15 years. It has a balance of ₹ 10,000 in Securities Premium Reserve.
Pass Journal entries. Also give Journal entries for writing off Loss on Issue of Debentures.

Exercise | Q 46 | Page 56

Global Ltd. issued 10,000, 8% Debentures of  ₹ 100 each redeemable in four equal instalments by draw of lots from the end of 3 years at a premium of ₹ 9.
Pass the Journal entries for writing off the Loss on Issue of Debentures. Also prepare Loss on issue of Debentures Account.

Exercise | Q 47 | Page 57

On 1st June, 2017, R Energy Ltd. issued 10,000, 7% Debentures of  ₹ 100 each at a discount of 10% redeemable at a premium of 10% at the end of five years. All the debentures were subscribed and allotment was made.

Prepare the Balance Sheet (extract) as at 31st March, 2018. 

Exercise | Q 48 | Page 57

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.

Exercise | Q 49 | Page 57

On 1st April, 2015. Mathew Ltd. issued 10,000, 9% Debentures of ₹ 100 each at a discount of 5%, redeemable at a premium of 5%. These debentures were redeemable as follows:

On 31st March, 2016 2,000 Debentures;
On 31st March, 2017 5,000 Debentures;
On 31st March, 2018 3,000 Debentures.

Prepare the Loss on Issue of Debentures Account, Debentures Account and Premium on Redemption of Debentures Account for three years.

Exercise | Q 50 | Page 57

Office Products Ltd, issued on 1st April, 2018, 20,000, 9% Debentures of ₹ 100 each at a premium of 10% redeemable at a premium of 5% after 5 years. Issue price was payable along with application. Pass the necessary Journal entries.

Chapter 2: Issue of Debentures

Exercise

T.S. Grewal T S Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 2

T S Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 2 - Shaalaa.com

Textbook solutions for Class 12






















T.S. Grewal solutions for Class 12 Accountancy chapter 2 - Issue of Debentures

T.S. Grewal solutions for Class 12 Accountancy chapter 2 (Issue of Debentures) include all questions with solution and detail explanation. This will clear students doubts about any question and improve application skills while preparing for board exams. The detailed, step-by-step solutions will help you understand the concepts better and clear your confusions, if any. Shaalaa.com has the CBSE T S Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 2 solutions in a manner that help students grasp basic concepts better and faster.

Further, we at Shaalaa.com provide such solutions so that students can prepare for written exams. T.S. Grewal textbook solutions can be a core help for self-study and acts as a perfect self-help guidance for students.

Concepts covered in Class 12 Accountancy chapter 2 Issue of Debentures are Meaning of Debentures, Distinction Between Shares and Debentures, Types of Debentures, Issue of Debentures, Over Subscription of Shares, Issue of Debentures for Consideration Other than Cash, Debentures as Collateral Security-concept, Issue of Debentures with Terms of Redemption, Interest on Debentures, Writing off Discount/Loss on Issue of Debentures, Redemption of Debentures.

Using T.S. Grewal Class 12 solutions Issue of Debentures exercise by students are an easy way to prepare for the exams, as they involve solutions arranged chapter-wise also page wise. The questions involved in T.S. Grewal Solutions are important questions that can be asked in the final exam. Maximum students of CBSE Class 12 prefer T.S. Grewal Textbook Solutions to score more in exam.

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