Question

Pass journal entries in the following cases:
(a) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a premium of 5% redeemable at par.
(b) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a discount of 10% redeemable at par.
(c) A Co.Ltd. issued ₹ 40,000; 12% Debentures at par redeemable at 10% premium.
(d) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a discount of 5% and redeemable at 5% premium.
(e) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a premium of 10% redeemable at 110%.

Answer 1

Answer:

e) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a premium of 10% redeemable at 110%..is the answer

Answer 2

Solution:

                                              Journal Entries  

Sr. No.     Particulars                                        Debit Rs.       Credit Rs.

a              Bank A/c                              Dr.      42,000

         To 12%Debenture Application A/c                              42,000

(Being debentures application money received )

12%Debenture Application A/c            Dr.     42,000

          To 12%Debenture A/c                                                40,000

        To Securities Premium A/c                                             2000

(Being debenture application money transferred to 12% Debentures account and securities premium account)  

b.              Bank A/c                              Dr       36,000

    To 12% Debenture Application A/c                                      36,000

(Being debenture application money received)  

12% Debenture Application A/c           Dr       36,000

Discount On Issue of Debentures A/c Dr       4,000

To 12% Debenture A/c (Being debenture of Rs 40,000 issued at 10% discount)                                                                                     40,000

c.                 Bank A/c                            Dr.     40,000

       To 12% Debenture Application A/c                                   40,000

(Being debenture application money received)

12% Debenture Application Ac             Dr       40,000

Loss On Issue of Debentures A/c                     4,000

       To 12% Debenture A/c                                                      40,000  

     To Premium on Redemption A/c                                            4,000

(Being debenture of Rs.40.000 issued at par with the term repayable at 10% premium)    

d.                  Bank A/c                             Dr.    38,000

        To 12%Debenture Application Ac                                   38,000

(Being debenture application money received)

12% Debenture Application A/c              Dr    38,000

Discount on Issue of Debentures A/c      Dr   2,000

Loss On Issue of Debentures A/c            Dr.    2,000

       To 12%Debenture A/c                                                        40,000

To Premium on Redemption A/c                                                 2,000

(Being debenture of Rs.40,000 issued at 5% discount with the term repayable at 5% premium)

e.                  Bank A/c                             Dr.     44.000

  To 12%Debenture Application A/c                                       44.000

(Being debenture application money received)

12% Debenture Application A/c              Dr.       44.000

Loss On Issue of Debentures A/c           Dr.        4,000

To 12%Debenture A/c                                                                 40000

To Securities Premium A/c                                                          4,000

To Premium on Redemption A/c                                                 4,000

(Being debenture of Rs 40,000 issued and Payable with at 104/ premium )