Question

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.

Answer 1

The necessary Journal entries in the books of the company are calculated and prepared below:

Explanation:

Given,

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.

The necessary Journal entries in the books of the company are calculated and prepared below: