Question

Wye Ltd. purchased an established business for ​₹ 2,00,000 payable as ₹ 65,000 by cheque and the balance by issuing 9% Debentures of ​₹ 100 each at a discount of 10%.
Give journal entries in the books of Wye Ltd.

Answer 1

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

Explanation:

Given,

Wye Ltd. purchased an established business for ​₹ 2,00,000 payable as ₹ 65,000 by cheque and the balance by issuing 9% Debentures of ​₹ 100 each at a discount of 10%.

Calculation of Number of Debentures Issued

Number of Debentures issued

$=\frac{\text { Purchase Consideration }}{\text { Issue Price }}$

$=\frac{1,35,000}{90}=1,500 \text { debentures }$

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