Zack Ltd. issued 10,000, 10% debentures of ?100 each at premium of ?20 each payable as:
?30 on application, ?50 on allotment and balance on first and final call. Application were
received for 12,000 debentures. Company decided to refund the application of 1,000
debenture and the remaining debentures were allotted on pro-rata basis. Excess money
received has been utilised towards allotment. Pass the necessary Journal entry of
Application.
Solution:
| Date | Particulars | L.F. | Amount (Rs.) | Amount (Rs.) | |
|---|---|---|---|---|---|
| Bank A/c To 10% debentures application A/c (Application amount received for 12,000 shares) | Dr. | 3,60,000 | 3,60,000 | ||
| 10% debenture application A/c To bank A/c To 10% debentures allotment A/c To 10% debentures A/c (Application amount for 10,000 shares transferred to share capital A/c, amount for 1,000 shares returned and the remaining 1,000 adjusted towards allotment) | Dr. | 3,60,000 | 30,000 30,000 3,00,000 | ||
| 10% debentures allotment A/c To 10% debentures A/c To security premium reserve A/c (Amount due on debenture allotment) | Dr. | 5,00,000 | 3,00,000 2,00,000 | ||
| Bank A/c To 10% debenture allotment A/c (Amount due on debentures received) | Dr. | 4,70,000 | 4,70,000 | ||
| 10% debenture first and final call A/c To 10% debentures A/c (Amount due on debentures 1st and final call) | Dr. | 4,00,000 | 4,00,000 | ||
| Bank A/c To 10% debentures A/c (Amount due on debentures received) | Dr. | 4,00,000 | 4,00,000 |