Question

please solve the question​

Answer 1

1) general reserve A/c dr 70000
To debenture redemption reserve 70000
( Being debenture redemption reserve created @ 10% on outstanding balance of debenture that is 800000 but 100000 is already present in DRR so 700000 created )

2) debenture redemption A/c. Dr 120000
Investment
To bank A/c. 120000
( Being DRI created @15% on outstanding balance of debenture that is 800000)

3) 8% Debenture. A/c. Dr 800000
To debentureholder. 800000
( being amt made due)

4) bank A/ c. Dr 120000
To deb redemption investment 120000
( being investment sold for redemption)


5) debentureholder.a/c. Dr 800000
To bank. 800000
( Being amt paid on debenture)


6) DRR. A/c. Dr 70000
To general reserve. 70000
( Being DRR transferred to general reserve on redemption)