Question

Paras Ltd. issued 40000, 11% debentures of 100 rupees each on 1st April 2015. Half of the debentures were due for redemption on 31st March 2019. The company decided to transfer the minimum required amount to Debenture Redemption Reserve on 31st March, 2018 and invested the necessary amount in debenture Redemption Investments on 30th April, 2018. Pass the necessary journal entries for Redemption of Debentures.


answer with proper explanation please

Answer 1

Explanation:

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Answer 2

Answer:

Explanation:

Journal Entries

Surplus A/c                                   1000000

 To  Debenture redemption reserve                   1000000

Debenture redemption reserveA/c     300000

 To   Bank A/c                                                         300000

Bank A/c                                 300000

 To Debenture redemption reserve           30000

11 % Debenture A/c              2000000

   To  Debenture holder                                2000000

Debenture A/c                     2000000

    To   Bank A/c                                            2000000

Debebture redemption reserve A/c      500000

    To General Reserve                                                500000