Issue and Redemption of Debentures Problems and Solutions
[AHSEC Solved Practical Problems 2012 to 2025]
2025
Give journal entries in the
books of MB Ltd. for issue and redemption of debentures under the following
situations: 2x3=6
(a) ₹4,50,000, 12%
Debentures issued at a discount of 5% and redeemable at a premium of 5%.
(b) 10,000, 15% Debentures
of ₹100 each issued at a premium of 10% and redeemable at par.
(c) 2,000, 8% Debentures of ₹100 each issued at a discount of 4% and redeemable at par.
Journal Entries
In the books of MB Ltd.
|
No. |
Particulars |
L/f |
Amount Dr. |
Amount Cr. |
|
a) |
At the time of Issue Bank A/c Dr. Loss on Issue of Debentures A/c Dr. To 12% Debentures A/c To Premium on Redemption of Debentures A/c (Being the 4500 12% Debentures of Rs. 100 each issued at a
discount of 5% and redeemed at premium of 5%) |
|
4,27,500 45,000 |
4,50,000 22,500 |
|
|
At the time of
Redemption 12% Debentures A/c
Dr.
Premium on Redemption of Debentures A/c Dr. To Bank A/c (Being the 4500 12% Debentures of Rs. 100 each redeemed at a
premium of 5%) |
|
4,50,000 22,500 |
4,72,500 |
|
b) |
At the time of Issue Bank A/c Dr. To 15% Debentures A/c To Securities Premium Reserve A/c (Being the 10000 15% Debentures of Rs. 100 each issued at a premium
of 10%, but redeemed at par) |
|
11,00,000 |
10,00,000 1,00,000 |
|
|
At the time of
Redemption 15% Debentures A/c
Dr. To Bank A/c (Being the 10000 15% Debentures of Rs. 100 each redeemed at par) |
|
10,00,000 |
10,00,000 |
|
c) |
At the time of Issue Bank A/c Dr. Discount on issue of debentures A/c Dr. To 8% Debentures A/c (Being the 2000 8% Debentures of Rs. 100 each issued at a discount
of 4% but repayable at par) |
|
1,92,000 8,000 |
2,00,000 |
|
|
At the time of
Redemption 8% Debentures A/c
Dr. To Bank A/c (Being the 2000 8% Debentures of Rs. 100 each redeemed at par) |
|
2,00,000 |
2,00,000 |
2024
13. Give Journal entries
in the books of Pakhi Ltd. for issue of debentures under the following
situations: 1+1+1+1+2=6
(a) Issued 5,000, 8%
debentures of Rs. 100 each at par redeemable at 5% premium after 4 years.
(b) Issued 6,000, 9%
debentures of Rs. 100 each at 5% premium, redeemable at par after 4 years.
(c) Issued 7,000, 10%
debentures of Rs. 100 each at 5% discount, redeemable at par after 4 years.
(d) Issued 8,000, 10%
debentures of Rs. 100 each at 5% premium, redeemable at 10% premium after 4
years.
(e) Issued 5,000, 9%
debentures of Rs. 100 each to the vendors for purchasing a machinery of Rs.
5,00,000.
Journal Entries
In the books of Pakhi Ltd
|
No. |
Particulars |
L/f |
Amount Dr. |
Amount Cr. |
|
a) |
At the time of Issue Bank A/c Dr. Loss on Issue of Debentures A/c Dr. To 8% Debentures A/c To Premium on Redemption of Debentures A/c (Being the 5000 8% Debentures of Rs. 100 each issued at par and
redeemed at premium of 5%) |
|
5,00,000 25,000 |
5,00,000 25,000 |
|
|
At the time of
Redemption 8% Debentures A/c
Dr.
Premium on Redemption of Debentures A/c Dr. To Bank A/c (Being the 5000 8% Debentures of Rs. 100 each redeemed at a
premium of 5%) |
|
5,00,000 25,000 |
5,25,000 |
|
b) |
At the time of Issue Bank A/c Dr. To 9% Debentures A/c To Securities Premium Reserve A/c (Being the 6000 9% Debentures of Rs. 100 each issued at a premium
of 5%, but redeemed at par) |
|
6,30,000 |
6,00,000 30,000 |
|
|
At the time of
Redemption 9% Debentures A/c
Dr. To Bank A/c (Being the 6000 9% Debentures of Rs. 100 each redeemed at par) |
|
6,00,000 |
6,00,000 |
|
c) |
At the time of Issue Bank A/c Dr. Discount on issue of debentures A/c Dr. To 10% Debentures A/c (Being the 7000 10% Debentures of Rs. 100 each issued at a
discount of 5% but repayable at par) |
|
6,65,000 35,000 |
7,00,000 |
|
|
At the time of
Redemption 10% Debentures A/c
Dr. To Bank A/c (Being the 7000 10% Debentures of Rs. 100 each redeemed at par) |
|
7,00,000 |
7,00,000 |
|
d) |
At the time of Issue Bank A/c Dr. Loss on issue of Debentures A/c
Dr. To 10% Debentures A/c To Securities Premium Reserve A/c To Premium on Redemption of Debentures A/c (Being the 8000 10% Debentures of Rs. 100 each issued at a premium
of 5%, but redeemed at a premium of 10%) |
|
8,40,000 80,000 |
8,00,000 40,000 80,000 |
|
|
At the time of
Redemption 10% Debentures A/c
Dr.
Premium on Redemption of Debentures A/c Dr. To Bank A/c (Being the 8000 10% Debentures of Rs. 100 each redeemed at a
premium of 10%) |
|
8,00,000 80,000 |
8,40,000 |
|
e) |
When amount is due
for purchase Machinery A/c Dr. To Vendor’s A/c (Being the purchase consideration due to the vendor of machinery) |
|
5,00,000 |
5,00,000 |
|
|
When Purchase Consideration
is Discharged Vendor’s A/c Dr. To 9% Debentures A/c (Being the purchase consideration discharged by the issue of 5000
9% debentures of Rs. 100 each) |
|
5,00,000 |
5,00,000 |
2023
Give Journal entries for
issue and redemption of debentures under the following situations: 2x3=6
(a) 1,000 12% debentures
of Rs. 100 each, issued at premium of 5% and redeemable at par.
(b) 2,000, 12% debentures
of Rs. 100 each, issued at 5% discount and redeemable at a premium of 5%.
(c) 3,000, 12% debentures
of Rs. 100 each, issued at par and redeemable at a premium of 5%.
Journal Entries
In the books of ________
|
No. |
Particulars |
L/f |
Amount Dr. |
Amount Cr. |
|
a) |
At the time of Issue Bank A/c Dr. To 12% Debentures A/c To Securities Premium Reserve A/c (Being the 1000 12% Debentures of Rs. 100 each issued at a premium
of 5%, but redeemed at par) |
|
1,05,000 |
1,00,000 5,000 |
|
|
At the time of
Redemption 12% Debentures A/c
Dr. To Bank A/c (Being the 1000 12% Debentures of Rs. 100 each redeemed at par) |
|
1,00,000 |
1,00,000 |
|
b) |
At the time of Issue Bank A/c Dr. Loss on issue of Debentures A/c
Dr. To 12% Debentures A/c To Premium on Redemption of Debentures A/c (Being the 2000 12% Debentures of Rs. 100 each issued at a discount
of 5%, but redeemed at a premium of 5%) |
|
1,90,000 20,000 |
2,00,000 10,000 |
|
|
At the time of
Redemption 12% Debentures A/c
Dr.
Premium on Redemption of Debentures A/c Dr. To Bank A/c (Being the 2000 12% Debentures of Rs. 100 each redeemed at a
premium of 5%) |
|
2,00,000 10,000 |
2,10,000 |
|
c) |
At the time of Issue Bank A/c Dr. Loss on issue of Debentures A/c
Dr. To 12% Debentures A/c To Premium on Redemption of Debentures A/c (Being the 3000 12% Debentures of Rs. 100 each issued at par, but
redeemed at a premium of 5%) |
|
3,00,000 15,000 |
3,00,000 15,000 |
|
|
At the time of Redemption 12% Debentures A/c
Dr.
Premium on Redemption of Debentures A/c Dr. To Bank A/c (Being the 3000 12% Debentures of Rs. 100 each redeemed at a
premium of 5%) |
|
3,00,000 15,000 |
3,15,000 |
2022/2017/2015/2016
21. Give the Journal
entries for issue and redemption of Debentures in respect of the following with
imaginary figures:
1. Debentures issued at
par and redeemable at par.
2. Debentures issued at
premium and redeemable at par.
3. Debentures issued at a
discount, redeemable at par.
4. Debentures issued at
par, redeemable at a premium.
5. Debentures issued at
premium and redeemable at premium.
6. Debentures issued at a
discount and redeemable at premium.
Journal Entries
In the books of _______________
|
|
Particulars |
L/f |
|
|
|
(a) |
At the time of Issue Bank
A/c
Dr. To Debenture A/c (Being the ___________ Debentures issued at par) |
|
|
|
|
|
At the time of redemption Debentures A/c Dr. To Bank A/c (Being
the ___________ Debentures redeemed at
par) |
|
|
|
|
(b) |
At the time of Issue Bank
A/c
Dr. To Debenture A/c To Securities Premium Reserve A/c (Being
the ___________ Debentures issued at a
premium of _______) |
|
|
|
|
|
At the time of redemption Debentures A/c Dr. To Bank A/c (Being
the ___________ Debentures redeemed at
par) |
|
|
|
|
(c) |
At the time of Issue Bank
A/c
Dr. Discount
on issue of Debentures A/c Dr. To Debenture A/c (Being
the ___________ Debentures issued at
par, but redeemable at a premium of ______________) |
|
|
|
|
|
At the time of redemption Debentures A/c
Dr. To Bank A/c (Being
the ___________ Debentures redeemed at
par) |
|
|
|
|
(d) |
At the time of Issue Bank
A/c
Dr. Loss
on Issue of Debentures A/c
Dr. To Debenture A/c To Premium on Redemption of Debentures A/c (Being
the ___________ Debentures issued at
par, but redeemable at a premium of ____) |
|
|
|
|
|
At the time of redemption Debentures
A/c Dr. Premium
on redemption of Debentures A/c Dr. To Bank A/c (Being
the ____________ Debentures redeemed
at a premium of ____) |
|
|
|
|
(e) |
At the time of Issue Bank
A/c
Dr. Loss
on Issue of Debentures A/c
Dr. To Debenture A/c To Premium on Redemption of Debentures A/c To Securities Premium Reserve A/c (Being
the ___________ Debentures issued at a
premium of ____, but redeemable at a premium of ____) |
|
|
|
|
|
At the time of redemption Debentures A/c Dr. Premium
on redemption of Debentures A/c Dr. To Bank A/c (Being
the ____________ Debentures redeemed
at a premium of ____) |
|
|
|
|
(f) |
At the time of Issue Bank
A/c Dr. Loss
on Issue of Debentures A/c Dr. (discount + premium on red.) To Debenture A/c To Premium on Redemption of Debentures A/c (Being
the ___________ Debentures issued at a
discount of ____, but redeemable at a premium of ____) |
|
|
|
|
|
At the time of redemption Debentures A/c Dr. Premium
on redemption of Debentures A/c Dr. To Bank A/c (Being
the ____________ Debentures redeemed
at a premium of ____) |
|
|
|
2020
21. Give journal entries
in the books of PM Ltd. relating to issue of debentures under the following
conditions: 2+3+3=8
a) 120, 8% Debentures of
Rs. 1,000 each issued at a discount of 5% and redeemable at par.
b) 150, 8% Debentures of
Rs. 1,000 each issued at 5% discount and redeemable at 10% premium.
c) 200, 7% Debentures of
Rs. 100 each, issued at a premium of 5% and redeemable at 10% premium.
Solution:
Journal Entries
In the Books of PM Ltd
|
Particulars |
L/F |
Amount |
Amount |
|
(a) For issue of
Debentures Bank A/c Dr. Discount on issue of Debentures A/c Dr. To 8% Debentures A/c (Being the 120, 8% Debentures of Rs. 1,000 each issued at a
discount of 5%) |
|
1,14,000 6,000 1,42,500 22,500 21,000 2,000 |
1,20,000 1,50,000 15,000 20,000 1,000 2,000 |
|
(b) For issue of
Debenture Bank A/c Dr. Loss on issue of Debentures A/c Dr. To 8% Debentures A/c To Premium on redemption of Debentures A/c (Being the 150, 8% Debentures of Rs. 1,000 each issued at 5%
Discount but redeemable at 10% premium) |
|||
|
(c) For issue of
Debentures Bank A/c Dr. Loss on issue of Debentures A/c Dr. To 7% Debentures A/c To Securities Premium Reserve A/c To Premium on redeemable of Debentures A/c (Being the 200, 7% Debentures of Rs. 100 each, issued at a premium
of 5% and redeemable at 10% premium) |
2019
21. S. K. issued 1,000,
12% Debentures of Rs. 100 each. Give Journal entries for Redemption of
debentures in the books of the company under the following conditions: 2+3+3=8
a) Issued at Par and
Redeemable at par after 5 years.
b) Issued at Par and
Redeemable at a premium of 5% after 5 years.
c) Issued at a Premium of
5% Redeemable at Par after 5 years.
Journal Entries
In the books of S.K. Ltd.
|
No. |
Particulars |
L/f |
Amount Dr. |
Amount Cr. |
|
a) |
At the time of Issue Bank A/c
Dr. To 12% Debentures A/c (Being the 1000 12% Debentures of Rs. 100 each issued at par and
also redeemed at par) |
|
1,00,000 |
1,00,000 |
|
|
At the time of
Redemption 12% Debentures A/c
Dr. To Bank A/c (Being the 1000 12% Debentures of Rs. 100 each redeemed at par) |
|
1,00,000 |
1,00,000 |
|
b) |
At the time of Issue Bank A/c Dr. Loss on issue of debentures A/c
Dr. To 12% Debentures A/c To Premium on redemption of debentures A/c (Being the 1000 12% Debentures of Rs. 100 each issued at par, but
repayable at a premium of 5%) |
|
1,00,000 5,000 |
1,00,000 5,000 |
|
|
At the time of
Redemption 12% Debentures A/c Dr. Premium on Redemption of debentures A/c Dr. To Bank A/c (Being the 1000 12% Debentures of Rs. 100 each redeemed at a
premium of 5%) |
|
1,00,000 5,000 |
1,05,000 |
|
c) |
At the time of Issue Bank A/c Dr. To 12% Debentures A/c To Securities Premium Reserve A/c (Being the 1000 12% Debentures of Rs. 100 each issued at a premium
of 5%, but repayable at par) |
|
1,05,000 |
1,00,000 5,000 |
|
|
At the time of
Redemption 12% Debentures A/c
Dr. To Bank A/c (Being the 1000 12% Debentures of Rs. 100 each redeemed at par) |
|
1,00,000 |
1,00,000 |
2018
21. X Ltd. issued 5,000,
16% debentures of Rs. 100/- each at a discount of 5% repayable after 5 years at
a premium of 5%. You are required to pass journal entries and show the “Loss on
Issue of Debentures Account” over the period of five years. 8
Journal Entries
In the books of X Ltd.
|
Particulars |
L/f |
Amount Dr. |
Amount Cr. |
|
At the time of Issue Bank A/c Dr. Loss on issue of debentures A/c Dr. To 16% Debentures A/c To Premium on redemption of debentures A/c (Being the 5000 16% Debentures of Rs. 100 each issued at a
discount of 5%, but repayable at a premium of 5%) |
|
4,75,000 50,000 |
5,00,000 25,000 |
|
At the time of
Redemption 16% Debentures A/c Dr. Premium on Redemption of debentures A/c Dr. To Bank A/c (Being the 5000 16% Debentures of Rs. 100 each redeemed at a
premium of 5%) |
|
5,00,000 25,000 |
5,25,000 |
Loss on issue of
Debentures A/c
|
Date |
Particulars |
Rs. |
Date |
Particulars |
Rs. |
|
Year 1 |
To 16% Debentures To Premium on redemption A/c |
25,000 25,000 |
Year 1 |
By Profit and Loss A/c By Balance c/d |
10,000 40,000 |
|
|
|
50,000 |
|
|
50,000 |
|
Year 2 |
To Balance b/d |
40,000 |
Year 2 |
By Profit and Loss A/c By Balance c/d |
10,000 30,000 |
|
|
|
40,000 |
|
|
40,000 |
|
Year 3 |
To Balance b/d |
30,000 |
Year 3 |
By Profit and Loss A/c By Balance c/d |
10,000 20,000 |
|
|
|
30,000 |
|
|
30,000 |
|
Year 4 |
To Balance b/d |
20,000 |
Year 4 |
By Profit and Loss A/c By Balance c/d |
10,000 10,000 |
|
|
|
20,000 |
|
|
20,000 |
|
Year 5 |
To Balance b/d |
10,000 |
Year 5 |
By Profit and Loss A/c |
10,000 |
|
|
|
10,000 |
|
|
10,000 |
Working Note:
Amount to be written off
each year.
= Amount of loss on issue of debentures/ No. of years = 50,000/5 =
10,000
2017
21.
Tata Motors Ltd. invited applications for the issue of 3,000, 10% debentures of
Rs. 100/- each at a discount of 10% payable Rs. 30/- on application, Rs. 30/-
on allotment (after deducting discount) and the balance on first and final
call. All the debentures were subscribed and the debenture money was duly
called and paid up. Give Journal entries and show how Debentures Account will
be shown in the Balance Sheet of the Company. 8
Solution:
Journal Entries for Tata Motors Ltd.
|
Particulars |
L/f |
Amount
Dr. |
Amount
Cr. |
|
Bank
A/c Dr. To 10% Debenture Application A/c (
Being application money received) |
|
90,000 |
90,000 |
|
10%
Debenture Application A/c Dr. To 10% Debentures A/c (
Being debentures allotted) |
|
90,000 |
90,000 |
|
10%
Debenture Allotment A/c Dr. Discount
on issue of debentures A/c Dr. To 10% Debentures A/c (Being
Debenture allotment money due) |
|
90,000 30,000 |
1,20,000 |
|
Bank
A/c Dr. To 10% Debenture Allotment A/c ( Being
allotment money received) |
|
90,000 |
90,000 |
|
10%
Debenture 1st & Final Call A/c Dr. To 10% Debentures A/c Being
debenture 1st & Final Call due) |
|
90,000 |
90,000 |
|
Bank
A/c
Dr. To 10% Debenture 1st
& Final Call A/c (
Being 1st & Final Call
money received) |
|
90,000 |
90,000 |
Balance Sheet
|
Particulars |
Amount |
|
I.
Equity & Liabilities: Non-Current
Liabilities Long
Term Borrowings 3,000
debentures @ 100 each |
3,00,000 |
|
|
3,00,000 |
|
II.
Assets: 1. Non-current assets Discount on issue of shares 2. Current Assets Cash and cash equivalents |
30,000 2,70,000 |
|
|
3,00,000 |
18. Guwahati Engineering Limited
issued 10000 6% Debentures of Rs.10 each at a discount of 5% but repayable
after 5 years at a premium of 10%. Show the entries in the books of the company
and also the accounting treatment of loss on issue of debentures for 5 years. 5
Solution:
Journal Entries
In the books of Guwahati Engineering
Ltd.
|
|
Particulars |
L/f |
Amount
Dr. |
Amount
Cr. |
|
|
Bank
A/c Dr. Loss
on issue of debentures A/c Dr. To
6% Debentures A/c To
Premium on redemption of debentures A/c (Being
the 10000 6% Debentures issued at a discount of 5%, but redeemable at a
discount of 10%) |
|
95,000 15,000 |
1,00,000 10,000 |
Loss on issue of Debentures A/c
|
Date |
Particulars |
Rs. |
Date |
Particulars |
Rs.
|
|
Year
1 |
To
6% Debenture A/c To
Premium on redemption A/c |
5,000 10,000 |
Year
1 |
By
Profit and Loss A/c By
Balance c/d |
3,000 12,000 |
|
|
|
15,000 |
|
|
15,000 |
|
Year
2 |
To
Balance b/d |
12,000 |
Year
2 |
By
Profit and Loss A/c By
Balance c/d |
3,000 9,000 |
|
|
|
12,000 |
|
|
12,000 |
|
Year
3 |
To
Balance b/d |
9,000 |
Year
3 |
By
Profit and Loss A/c By
Balance c/d |
3,000 6,000 |
|
|
|
9,000 |
|
|
9,000 |
|
Year
4 |
To
Balance b/d |
6,000 |
Year
4 |
By
Profit and Loss A/c By
Balance c/d |
3,000 3,000 |
|
|
|
6,000 |
|
|
6,000 |
|
Year
5 |
To
Balance b/d |
3,000 |
|
By
Profit and Loss A/c |
3,000 |
|
|
|
3,000 |
|
|
3,000 |
Working Note: Amount to be written off each year =
15,000/5 = 3,000
2013
22. Fair Deal Ltd. invited
applications for the issue of 2000, 10%Debentures of Rs.100 each at a discount
of 10% payable Rs.30 on application on 1st May, 2010, Rs.30 on
allotment (after deducting discount) on 1st June, 2010 and balance
on first and final call on 1st July, 2010. All the debentures were
fully subscribed. Debentures money was duly called and paid up. Give the Journal Entries and show how the
debentures and Debenture Discount will be shown in the Balance sheet of the
company. 8
Solution:
Journal Entries
In the books of Fair Deal Ltd.
|
Date |
Particulars |
L/f |
Amount
Dr. |
Amount
Cr. |
|
1st
May |
Bank
A/c Dr. To 10% Debentures Application A/c (Being
the debenture application money received on 2,000 debentures) |
|
60,000 |
60,000 |
|
|
10%
Debenture Application A/c Dr. To 10% Debenture A/c (Being
the debentures application money transferred to debentures a/c) |
|
60,000 |
60,000 |
|
1st
June |
10%
Debenture Allotment A/c Dr. Discount
on issue of debentures A/c Dr. To 10% Debentures A/c (Being
the allotment money due on 2000 debentures @ Rs. 30 each after deducting
discount @Rs. 10 per debenture) |
|
60,000 20,000 |
80,000 |
|
|
Bank
A/c Dr. To 10% Debenture Allotment A/c (Being
the allotment money received on 2000 debentures) |
|
60,000 |
60,000 |
|
1st
July |
10%
Debentures 1st and Final Call A/c Dr. To 10% Debentures A/c (Being
the 1st and final call money due on 2000 debentures @ Rs. 30 each
) |
|
60,000 |
60,000 |
|
|
Bank
A/c
Dr. To 10% Debentures 1st
& Final call A/c (Being
the 1st and final call money received on 2000 debentures) |
|
60,000 |
60,000 |
Balance Sheet of Fair Deal Ltd.
|
Particulars |
Amount |
|
Equity
& Liabilities: 1.
Non-Current Liabilities Debentures:
2,000 debentures @ 100 each |
2,00,000 |
|
Total |
2,00,000 |
|
Assets: 1.
Non Current Assets Other non-current assets Discount on issue of shares 2.
Current Assets Cash
and Cash equivalents |
20,000 1,80,000 |
|
Total |
20,000 |
2012
(a) A. Ltd. Issues 6,000, 10%
debenture of Rs 100 each at a discount of 5%, redeemable at the end of 5 year
at par.
(b) B. Ltd. issue 7,000, 11% debenture
of Rs 100 each at par, redeemable at the end of 5 year at a premium of 5%.
(c) X. Ltd. issue 8,000, 12% debenture
of Rs 100 each at a discount of 5%, redeemable at the end of 5 year at premium
of 5%.
Solution:
Journal Entries
In the books of A Ltd.
|
|
Particulars |
L/f |
Amount
Dr. |
Amount
Cr. |
|
(a) |
At the time of Issue Bank
A/c Dr. Discount
on issue of debentures A/c Dr. To 10% Debenture A/c (Being
the 6000 10% Debentures issued at a discount of 5%) |
|
5,70,000 30,000 |
6,00,000 |
|
|
At the time of redemption 10%
Debentures A/c Dr. To Bank A/c (Being
the 6000 10% Debentures redeemed at par) |
|
6,00,000 |
6,00,000 |
Journal Entries
In the books of B Ltd.
|
|
Particulars |
L/f |
Amount
Dr. |
Amount
Cr. |
|
(b) |
At the time of Issue Bank
A/c Dr. Loss
on Issue of Debentures A/c Dr. To 11% Debenture A/c To Premium on Redemption of Debentures A/c (Being
the 7000 11% Debentures issued at par, but redeemable at a premium of 5%) |
|
7,00,000 35,000 |
7,00,000 35,000 |
|
|
At the time of redemption 11%
Debentures A/c Dr. Premium
on redemption of Debentures A/c Dr. To Bank A/c (Being
the 7000 11% Debentures redeemed at a premium of 5%) |
|
7,00,000 35,000 |
7,35,000 |
Journal Entries
In the books of C Ltd.
|
|
Particulars |
L/f |
Amount
Dr. |
Amount
Cr. |
|
(c) |
At the time of Issue Bank
A/c Dr. Loss
on Issue of Debentures A/c Dr. To 12% Debenture A/c To Premium on Redemption of Debentures A/c (Being
the 8000 10% Debentures issued at a discount of 5%, but redeemable at a
premium of 5%) |
|
7,60,000 80,000 |
8,00,000 40,000 |
|
|
At the time of redemption 12%
Debentures A/c Dr. Premium
on redemption of Debentures A/c Dr. To Bank A/c (Being
the 8000 12% Debentures redeemed at a premium of 5%) |
|
8,00,000 40,000 |
8,40,000 |
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