Volume-2 | Chapter-2 | Question 31 to 35 | Issue of Debentures | Ts grewal solution 2020-21 | Class-12th



Page No 9.55:

Question 31:

Pass journal entries in the following cases:
(a) Rohit Ltd. issued 
`40,000; 12% Debentures at a premium of 5% redeemable at par.
(b) Virat Ltd. issued 
`40,000; 12% Debentures at a discount of 10% redeemable at par.
(c) Rahul Ltd. issued 
`40,000; 12% Debentures at par redeemable at 10% premium.
(d) Prithvi Ltd. issued 
`40,000; 12% Debentures at a discount of 5%  and redeemable at 5% premium.
(e) Shikhar Ltd. issued 
`40,000; 12% Debentures at a premium of 10% redeemable at 110%.



Answer:

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

(a)

Bank A/c

Dr.

 

42,000

 

 

To 12% Debenture Application A/c

 

 

42,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

42,000

 

 

To 12% Debentures A/c

 

 

40,000

 

To Securities Premium A/c

 

 

2,000

 

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

 

 

 

 

 

 

 

 

 

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

(b)

Bank A/c

Dr.

 

36,000

 

 

To 12% Debenture Application A/c

 

 

36,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

36,000

 

 

Discount on Issue of Debentures A/c

Dr.

 

4,000

 

 

To 12% Debentures A/c

 

 

40,000

 

(Debentures of Rs 40,000 issued at 10% discount)

 

 

 

 

 

 

 

 

 

 

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

(c)

Bank A/c

Dr.

 

40,000

 

 

To 12% Debenture Application A/c

 

 

40,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

40,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

4,000

 

 

To 12% Debentures A/c

 

 

40,000

 

To Premium on Redemption A/c

 

 

4,000

 

(Debentures of Rs 40,000 issued at par with the term repayable at 10% premium)

 

 

 

 

 

 

 

 

 

Journal

 

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

(d)

Bank A/c

Dr.

 

38,000

 

 

 

To 12% Debenture Application A/c

 

 

38,000

 

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

38,000

 

 

 

Discount on Issue of Debenture A/c

Dr.

 

2,000

 

 

 

Loss on Issue of Debenture A/c

Dr.

 

2,000

 

 

 

To 12% Debentures A/c

 

 

40,000

 

 

To Premium on Redemption A/c

 

 

2,000

 

 

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

 

 

 

 

 

 

 

 

 

 


Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

(e)

Bank A/c

Dr.

 

44,000

 

 

To 12% Debenture Application A/c

 

 

44,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

44,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

4,000

 

 

To 12% Debentures A/c

 

 

40,000

 

To Securities Premium A/c

 

 

4,000

 

  To Premium on Redemption A/c

 

 

4,000

 

(Debenture of Rs 40,000 issued at 10% premium with the term payable at 10% premium)

 

 

 

 

 

 

 

 



Page No 9.55:



Question 32:

Answer:

 

In the books of ZK Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

(e)

Bank A/c

Dr.

 

3,80,000

 

 

To 9% Debenture Application A/c

 

 

3,80,000

 

(Debenture application money received at 5% discount)

 

 

 

 

 

 

 

 

 

9% Debenture Application A/c

Dr.

 

3,80,000

 

 

Discount on Issue of Debentures A/c

Dr.

 

20,000

 

Loss on Issue of Debentures A/c

Dr.

40,000

 

To 9% Debentures A/c

 

 

4,00,000

 

  To Premium on Redemption A/c

 

 

40,000

 

(Debenture of Rs 4,00,000 issued at 5% Discount with the term payable at 10% premium)

 

 

 

 

 

 

 

 



Page No 9.55:

Question 33:



Answer:

In the books of X Ltd.

Journal

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

Bank A/c

Dr.

 

94,000

 

To 9% Debenture Application A/c

 

 

94,000

(Debenture application money received at 6% discount)

 

 

 

 

 

 

 

9% Debenture Application A/c

Dr.

 

94,000

 

Discount on Issue of Debentures A/c

Dr.

 

6,000

 

Loss on Issue of Debentures A/c

Dr.

10,000

To 9% Debentures A/c

 

 

1,00,000

  To Premium on Redemption A/c

 

 

10,000

(Debenture of Rs 1,00,000 issued at 6% Discount with the term payable at 10% premium)

 

 

 

 

 

 

 

1

Dr.

Discount on Issue of Debentures A/c

Cr.

Date

Particulars

Amount

(`)

Date

Particulars

Amount

(`)

On the date of Issue

To 9% Debentures A/c

6,000

By the end of Year of allotment

By Statement of Profit & Loss A/c

6,000

 

 

 

 

 

 

 

 

6,000

 

 

6,000

 

 

 

 

 

 

 



Page No 9.55:

Question 34:

Pass necessary Journal entries relating to the issue of  debentures for the following:

(a) Issued  ` 28,000; 10% Debentures of  ` 100 each at a premium of 15% redeemable at par.
(b) Issued  ` 30,000; 10% Debentures of  
` 100 each at a premium of 10% and redeemable at a premium of 15%.
(c) Issued  ` 80,000; 10% Debentures of  
` 100 each at par repayable at a premium of 10%.



Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit 

Amount

Rs

(a)

Bank A/c (280 debentures × 115)

Dr.

 

32,200

 

 

To Debenture Application and Allotment A/c

 

 

 

32,200

 

(Application money received)

 

 

 

 

 

 

 

 

 

Debenture Application and Allotment A/c

Dr.

 

32,200

 

 

To 10% Debentures A/c

 

 

 

28,000

 

To Securities Premium Reserve A/c

 

 

 

4,200

 

(280; 10% Debentures issued at a premium of 15%)

 

 

 

 

 

 

 

 

(b)

Bank A/c

Dr.

 

33,000

 

 

To Debenture Application and Allotment A/c

 

 

 

33,000

 

(Application money received)

 

 

 

 

 

 

 

 

 

Debenture Application and Allotment A/c

Dr.

 

33,000

 

 

Loss On Issue of debentures A/c

Dr.

 

4,500

 

 

To 10% Debentures A/c

 

 

 

30,000

 

To Securities Premium Reserve A/c

 

 

 

3,000

 

To Premium on Redemption of debentures A/c

 

 

 

4,500

 

(300; 10% Debentures issued at a premium of 10% and redeemable at a premium of 15%)

 

 

 

 

 

 

 

 

(c)

Bank A/c

Dr.

 

80,000

 

 

To Debenture Application and Allotment A/c

 

 

 

80,000

 

(Application money received)

 

 

 

 

 

 

 

 

 

 

Debenture Application and Allotment A/c

Dr.

 

80,000

 

 

Loss On Issue of debentures A/c

Dr.

 

8,000

 

 

To 10% Debentures A/c

 

 

 

80,000

 

To Premium on Redemption of debentures A/c

 

 

 

8,000

 

(800; 10% Debentures issued at par and redeemable at premium of 10%)

 

 

 

 

 

 

 

 



 Page No 9.56:

Question 35:

Pass necessary Journal entries for the issue of debentures in the following cases:
(a)  
` 40,000; 12% Debentures of  ` 100 each issued at a premium of 5% redeemable at par.
(b)
` 70,000; 12% Debentures of  ` 100 each issued at a premium of 5% redeemable at ` 110.



Answer:

(a)

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

42,000

 

 

To Debenture Application A/c

 

 

 

42,000

 

(400 debentures issued at Rs 100 at a premium of 5%)

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

42,000

 

 

To 12% Debenture A/c

 

 

 

40,000

 

To Securities Premium A/c

 

 

 

2,000

 

(400 debentures issued at a premium of 5% and redeemable at par)

 

 

 

 

 

 

 

 

 

 

(b)

 Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

73,500

 

 

To Debenture Application A/c

 

 

 

73,500

 

(700 debentures issued at Rs 100 at a premium of 5%)

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

73,500

 

 

Loss on Issue of Debentures A/c

Dr.

 

7,000

 

 

To 12% Debenture A/c

 

 

 

70,000

 

To Securities Premium A/c

 

 

 

3,500

 

To Premium on Redemption A/c

 

 

 

7,000

 

(70,000 debentures issued at a premium of 5% and redeemable at Rs 110)

 

 

 

 

 

 

 

 

 

 


Click on Below link for more questions of Issue Of Debenture

From Question No. 1 to 5

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