Question

A company issued 10,000 debentures of Rs.100

each for subscription. Debenture moneys are

payable as Rs.30 on application, Rs.40 on

allotment, Rs.20 on first call and Rs.10 on final

call. A person who holds 200 debentures fails to

pay the amount due at the time of allotment. He

however pays this amount with the first call

money. Another person, who is holding 400

debentures, has paid all the calls in advance at the

time of allotment.

Give journal entries in the books of company
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Answer 1

In this question, we are asked to pass the necessary journal entries in the books of the company.

Bank A/C DR 3,00,000

            To Debenture Application A/C 3,00,000

(Being allotment money received)

Debenture Application A/C 3,00,000

            To Debenture A/C 3,00,000

(Application money transferred to debentures account)

Debenture Allotment A/C DR 4,00,000

             To Debenture A/C 4,00,000

(Being allotment due)

Bank A/C DR  4,04,000

Call in arrear A/C DR 8,000

                To Debenture Allotment A/C 4,00,000

               To Call in Advance A/C 12,000

(Being allotment money received and holder of 200 failed to pay the money)

Debenture First Call A/C 2,00,000

                 To Debenture A/C 2,00,000

(Being first call due)

Bank A/C DR  2,08,000

Call in advance A/C DR 8,000

           To   Debenture First Call A/C 2,00,000

            To Debenture Allotment A/C 8,000

Debenture Second and final Call A/C 1,00,000

                 To Debenture A/C 1,00,000

(Being second call due)

Bank A/C 96,000

Call in advance A/C 4,000

                 To Debenture Second and final Call A/C 1,00,000

(Being money received)

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