Question

X Ltd. has a balance of Rs. 4,00,000 in Surplus, i.e., Balance in Statement of Profit and Loss.
The company decided not to pay divident and instead redeem Rs. 3,50,000, `12%` Debentures on 30th September, 2018 at a premium of `10%` in accordance with terms of issue. Debentures interest is payable annually on 31st March every year when the accounts are closed. The company also has a balance of Rs. 2,00,000 in the Debentures Redemption Reserve.
Tax was deducted @ `10%` on interest on debentures and deposited in Government Account.
The required investment was made by the company Government Securities on 30th April, 2018. Journalies the transactions.

Answer 1

Answer:

X Ltd. has a balance of Rs. 4,00,000 in Surplus, i.e., Balance in Statement of Profit and Loss.

The company decided not to pay divident and instead redeem Rs. 3,50,000, `12%` Debentures on 30th September, 2018 at a premium of `10%` in accordance with terms of issue. Debentures interest is payable annually on 31st March every year when the accounts are closed. The company also has a balance of Rs. 2,00,000 in the Debentures Redemption Reserve.

Tax was deducted @ `10%` on interest on debentures and deposited in Government Account.

The required investment was made by the company Government Securities on 30th April, 2018. Journalies the transactions.

Explanation:

ACTIVITY and I am