Question

Issue 1,000,8% Debenture of 100 each at a discount of 10% and redeemable at par

Answer 1

Answer:

Journal entry

Bank Ac Dr. 90,000

To 8% Debenture Application 90,000

(Money received @10% discount on debenture application)

Debenture Application Dr. 90000

Discount on issue of debenture Dr. 10,000

To 8% Debenture Ac 100,000

(Debenture application is being transferred to 8%Debenture Ac)

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