Question

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.

Answer 1

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

Explanation:

Given,

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.

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