Double Entry Book Keeping Ts Grewal 2017 Solutions for Class 12 Commerce Accountancy Chapter 7 Joint Stock Company Accounts Issue Of Debentures are provided here with simple step-by-step explanations. These solutions for Joint Stock Company Accounts Issue Of Debentures are extremely popular among class 12 Commerce students for Accountancy Joint Stock Company Accounts Issue Of Debentures Solutions come handy for quickly completing your homework and preparing for exams. All questions and answers from the Double Entry Book Keeping Ts Grewal 2017 Book of class 12 Commerce Accountancy Chapter 7 are provided here for you for free. You will also love the ad-free experience on Meritnation’s Double Entry Book Keeping Ts Grewal 2017 Solutions. All Double Entry Book Keeping Ts Grewal 2017 Solutions for class 12 Commerce Accountancy are prepared by experts and are 100% accurate.

Page No 7.48:

Question 1:

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   50,000  
 
To Debenture Application A/c
      50,000
  (Application money received on 2,000 debentures)        
           
  Debenture Application A/c Dr.   50,000  
 
To 8% Debentures A/c
      50,000
  (Application money transferred to Debentures Account)      
           
  Debenture Allotment A/c Dr.   50,000  
 
To 8% Debentures A/c
      50,000
  (Allotment money due on 2,000 debentures)        
           
  Bank A/c Dr.   50,000  
 
To Debenture Allotment A/c
      50,000
  (Allotment money received on 2,000 debentures)        
           
  Debenture First and Final Call A/c Dr.   1,00,000  
 
To 8% Debentures A/c
      1,00,000
  (First and final call due on 2,000 debentures)        
           
  Bank A/c Dr.   1,00,000  
 
To Debenture First and Final Call A/c
      1,00,000
  (Amount received on first and final call)        
           



Page No 7.49:

Question 2:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   50,000  
 
To Debenture Application A/c
      50,000
  (Application money received on 2,000 debentures)        
           
  Debenture Application A/c Dr.   50,000  
 
To 8% Debentures A/c
      50,000
  (Application money transferred to Debentures Account)      
           
  Debenture Allotment A/c Dr.   50,000  
 
To 8% Debentures A/c
      50,000
  (Allotment money due on 2,000 debentures)        
           
  Bank A/c Dr.   50,000  
 
To Debenture Allotment A/c
      50,000
  (Allotment money received on 2,000 debentures)        
           
  Debenture First and Final Call A/c Dr.   1,00,000  
 
To 8% Debentures A/c
      1,00,000
  (First and final call due on 2,000 debentures)        
           
  Bank A/c Dr.   1,00,000  
 
To Debenture First and Final Call A/c
      1,00,000
  (Amount received on first and final call)        
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   60,00,000  
 
To Debenture Application and Allotment A/c
      60,00,000
  (Application money received on 60,000 debentures)      
           
  Debenture Application and Allotment A/c Dr.   60,00,000  
 
To 10% Debentures A/c
      40,00,000
 
To Bank A/c
      20,00,000
  (Application money transferred to Debentures Account and excess money refunded)      
           

Page No 7.49:

Question 3:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   60,00,000  
 
To Debenture Application and Allotment A/c
      60,00,000
  (Application money received on 60,000 debentures)      
           
  Debenture Application and Allotment A/c Dr.   60,00,000  
 
To 10% Debentures A/c
      40,00,000
 
To Bank A/c
      20,00,000
  (Application money transferred to Debentures Account and excess money refunded)      
           

Answer:

Books of A Ltd.

Journal

Date

Particular

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

48,000

 

 

To 9% Debenture Application A/c

 

 

48,000

 

(Debenture application money received for 2,400 debentures at Rs 20 each)

 

 

 

 

 

 

 

 

 

9% Debenture Application A/c

Dr.

 

48,000

 

 

To 9% Debentures A/c

 

 

40,000

 

To 9% Debentures Allotment A/c

 

 

4,000

 

To Bank A/c

 

 

4,000

 

(Debenture application money transferred to 9% Debenture account for 2,000 Debenture, adjusted to Debenture Allotment account for 200 Debentures and money refunded for 200 debentures)

 

 

 

 

 

 

 

 

 

9% Debenture Allotment A/c

Dr.

 

40,000

 

 

To 9% Debentures A/c

 

 

40,000

 

(Debenture allotment money due on 2,000 debentures at Rs 20 each)

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

36,000

 

 

To 9% Debentures Allotment A/c

 

 

36,000

 

(Debenture allotment money received)

 

 

 

 

 

 

 

 

 

Debenture First Call A/c

Dr.

 

60,000

 

 

To 9% Debentures A/c

 

 

60,000

 

(Debenture first call money due on 2,000 9% debenture at Rs 30 each)

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

60,000

 

 

To Debenture First Call A/c

 

 

60,000

 

(Debenture first call money received)

 

 

 

 

 

 

 

 

 

Debenture Final Call A/c

Dr.

 

60,000

 

 

To 9% Debentures A/c

 

 

60,000

 

(Debentures final call money due on 2,000 9% Debentures at Rs 30 each)

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

60,000

 

 

To Debenture Final Call A/c

 

 

60,000

 

(Debenture final call received on 2,000 9% Debenture at Rs 30 each)

 

 

 

 

 

 

 

 

Page No 7.49:

Question 4:

Books of A Ltd.

Journal

Date

Particular

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

48,000

 

 

To 9% Debenture Application A/c

 

 

48,000

 

(Debenture application money received for 2,400 debentures at Rs 20 each)

 

 

 

 

 

 

 

 

 

9% Debenture Application A/c

Dr.

 

48,000

 

 

To 9% Debentures A/c

 

 

40,000

 

To 9% Debentures Allotment A/c

 

 

4,000

 

To Bank A/c

 

 

4,000

 

(Debenture application money transferred to 9% Debenture account for 2,000 Debenture, adjusted to Debenture Allotment account for 200 Debentures and money refunded for 200 debentures)

 

 

 

 

 

 

 

 

 

9% Debenture Allotment A/c

Dr.

 

40,000

 

 

To 9% Debentures A/c

 

 

40,000

 

(Debenture allotment money due on 2,000 debentures at Rs 20 each)

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

36,000

 

 

To 9% Debentures Allotment A/c

 

 

36,000

 

(Debenture allotment money received)

 

 

 

 

 

 

 

 

 

Debenture First Call A/c

Dr.

 

60,000

 

 

To 9% Debentures A/c

 

 

60,000

 

(Debenture first call money due on 2,000 9% debenture at Rs 30 each)

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

60,000

 

 

To Debenture First Call A/c

 

 

60,000

 

(Debenture first call money received)

 

 

 

 

 

 

 

 

 

Debenture Final Call A/c

Dr.

 

60,000

 

 

To 9% Debentures A/c

 

 

60,000

 

(Debentures final call money due on 2,000 9% Debentures at Rs 30 each)

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

60,000

 

 

To Debenture Final Call A/c

 

 

60,000

 

(Debenture final call received on 2,000 9% Debenture at Rs 30 each)

 

 

 

 

 

 

 

 

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   50,000  
 
To Debentures Application A/c
      50,000
  (Applications money received for 5,000, 8% debentures @ Rs 10 per debenture)      
           
  Debentures Application A/c Dr.   50,000  
 
To 8% Debentures A/c
      50,000
  (Application money transferred to 8% Debentures A/c)      
           
  Debenture Allotment A/c (5,000 × 20) Dr.   1,00,000  
 
To 8% Debentures A/c (5,000 × 15)
      75,000
 
To Securities Premium A/c (5,000 × 5)
      25,000
  (Allotment money due on 5,000 debentures)        
           
  Bank A/c Dr.   1,00,000  
 
To Debentures Allotment A/c
      1,00,000
  (Allotment money received on 5,000 debentures)        
           
  Debenture First and Final Call A/c (5,000 × 75) Dr.   3,75,000  
 
To 8% Debentures A/c
      3,75,000
  ( Amount due on first call @ Rs 75 per debenture)        
           
  Bank A/c Dr.   3,75,000  
 
To Debentures First and Final Call A/c
      3,75,000
  (Amount received on first call)        
         
 
Balance Sheet of X Lt.d
as at …..
Particulars Note
No.
Amount
(Rs)
I. Equity and Liabilities    
1. Shareholders’ Funds
   
a. Share Capital
   
b. Reserves and Surplus
1 25,000
2. Non-Current Liabilities
   
a. Long-term Borrowings
2 5,00,000
Total   5,25,000

II. Assets
   
2. Current Assets
   
a. Cash and Cash Equivalents
3 5,25,000
Total   5,25,000
     
 
NOTES TO ACCOUNTS
Note
No.
Particulars Amount (Rs)
1 Reserves and Surplus  
 
Securities Premium
25,000
2 Long Term Borrowings  
 
5,000, 8% Debentures of Rs 100 each
5,00,000
3 Cash and Cash Equivalents  
 
Cash at Bank
5,25,000
     

Page No 7.49:

Question 5:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   50,000  
 
To Debentures Application A/c
      50,000
  (Applications money received for 5,000, 8% debentures @ Rs 10 per debenture)      
           
  Debentures Application A/c Dr.   50,000  
 
To 8% Debentures A/c
      50,000
  (Application money transferred to 8% Debentures A/c)      
           
  Debenture Allotment A/c (5,000 × 20) Dr.   1,00,000  
 
To 8% Debentures A/c (5,000 × 15)
      75,000
 
To Securities Premium A/c (5,000 × 5)
      25,000
  (Allotment money due on 5,000 debentures)        
           
  Bank A/c Dr.   1,00,000  
 
To Debentures Allotment A/c
      1,00,000
  (Allotment money received on 5,000 debentures)        
           
  Debenture First and Final Call A/c (5,000 × 75) Dr.   3,75,000  
 
To 8% Debentures A/c
      3,75,000
  ( Amount due on first call @ Rs 75 per debenture)        
           
  Bank A/c Dr.   3,75,000  
 
To Debentures First and Final Call A/c
      3,75,000
  (Amount received on first call)        
         
 
Balance Sheet of X Lt.d
as at …..
Particulars Note
No.
Amount
(Rs)
I. Equity and Liabilities    
1. Shareholders’ Funds
   
a. Share Capital
   
b. Reserves and Surplus
1 25,000
2. Non-Current Liabilities
   
a. Long-term Borrowings
2 5,00,000
Total   5,25,000

II. Assets
   
2. Current Assets
   
a. Cash and Cash Equivalents
3 5,25,000
Total   5,25,000
     
 
NOTES TO ACCOUNTS
Note
No.
Particulars Amount (Rs)
1 Reserves and Surplus  
 
Securities Premium
25,000
2 Long Term Borrowings  
 
5,000, 8% Debentures of Rs 100 each
5,00,000
3 Cash and Cash Equivalents  
 
Cash at Bank
5,25,000
     

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (3000×30)

Dr.

 

90,000

 

 

  To Debenture Application A/c

 

 

 

90,000

 

(Received application money on 3,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

90,000

 

 

  To 10% Debentures A/c

 

 

 

60,000

 

  To Securities Premium Reserve A/c (3,000×10)

 

 

 

30,000

 

(Transfer of application money to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

 

Debenture Allotment A/c (3,000×40)

Dr.

 

1,20,000

 

 

  To 10% Debentures A/c (3,000×20)

 

 

 

60,000

 

  To Securities Premium Reserve A/c (3,000×20)

 

 

 

60,000

 

(Allotment due on 3,000 Debentures at a premium of Rs 20 per Debentures)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

1,20,000

 

 

  To Debenture Allotment A/c

 

 

 

1,20,000

 

(Allotment money received)

 

 

 

 

 

 

 

 

 

 

 

Debenture First and Final Call  A/c (3,000×60)

 

 

1,80,000

 

 

  To 10% Debentures A/c

 

 

 

1,80,000

 

(First and Final Call  due on 3,000 Debentures at Rs 60 per Debentures)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

1,80,000

 

 

  To Debenture First and Final Call  A/c

 

 

 

1,80,000

 

(First and Final Call  money received)

 

 

 

 

 

 

 

 

 

 

Page No 7.49:

Question 6:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (3000×30)

Dr.

 

90,000

 

 

  To Debenture Application A/c

 

 

 

90,000

 

(Received application money on 3,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

90,000

 

 

  To 10% Debentures A/c

 

 

 

60,000

 

  To Securities Premium Reserve A/c (3,000×10)

 

 

 

30,000

 

(Transfer of application money to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

 

Debenture Allotment A/c (3,000×40)

Dr.

 

1,20,000

 

 

  To 10% Debentures A/c (3,000×20)

 

 

 

60,000

 

  To Securities Premium Reserve A/c (3,000×20)

 

 

 

60,000

 

(Allotment due on 3,000 Debentures at a premium of Rs 20 per Debentures)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

1,20,000

 

 

  To Debenture Allotment A/c

 

 

 

1,20,000

 

(Allotment money received)

 

 

 

 

 

 

 

 

 

 

 

Debenture First and Final Call  A/c (3,000×60)

 

 

1,80,000

 

 

  To 10% Debentures A/c

 

 

 

1,80,000

 

(First and Final Call  due on 3,000 Debentures at Rs 60 per Debentures)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

1,80,000

 

 

  To Debenture First and Final Call  A/c

 

 

 

1,80,000

 

(First and Final Call  money received)

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (5,000×40)

Dr.

 

2,00,000

 

 

  To Debenture Application A/c

 

 

 

2,00,000

 

(Application money received)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

2,00,000

 

 

  To 9% Debentures A/c (5,000×30)

 

 

 

1,50,000

 

  To Security Premium Reserve A/c (5,000×10)

 

 

 

50,000

 

(Application money adjusted)

 

 

 

 

 

 

 

 

 

 

 

Debenture Allotment A/c (5,000×45)

Dr.

 

2,25,000

 

 

  To 9% Debentures A/c  (5,000×30)

 

 

 

1,50,000

 

  To Security Premium Reserve A/c (5,000×15)

 

 

 

75,000

 

(Allotment money due)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (5,000×45)

Dr.

 

2,25,000

 

 

   To Debenture Allotment A/c

 

 

 

2,25,000

 

(Allotment money received)

 

 

 

 

 

 

 

 

 

 

 

 Debenture First and Final call A/c (5,000×55)

Dr.

 

2,75,000

 

 

  To 9% Debentures A/c (5,000×40)

 

 

 

2,00,000

 

  To Security Premium Reserve A/c (5,000×15)

 

 

 

75,000

 

(First call money due)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

2,75,000

 

 

  To Debenture Final and Final call A/c

 

 

 

2,75,000

 

(First Call money Received)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Page No 7.49:

Question 7:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (5,000×40)

Dr.

 

2,00,000

 

 

  To Debenture Application A/c

 

 

 

2,00,000

 

(Application money received)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

2,00,000

 

 

  To 9% Debentures A/c (5,000×30)

 

 

 

1,50,000

 

  To Security Premium Reserve A/c (5,000×10)

 

 

 

50,000

 

(Application money adjusted)

 

 

 

 

 

 

 

 

 

 

 

Debenture Allotment A/c (5,000×45)

Dr.

 

2,25,000

 

 

  To 9% Debentures A/c  (5,000×30)

 

 

 

1,50,000

 

  To Security Premium Reserve A/c (5,000×15)

 

 

 

75,000

 

(Allotment money due)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (5,000×45)

Dr.

 

2,25,000

 

 

   To Debenture Allotment A/c

 

 

 

2,25,000

 

(Allotment money received)

 

 

 

 

 

 

 

 

 

 

 

 Debenture First and Final call A/c (5,000×55)

Dr.

 

2,75,000

 

 

  To 9% Debentures A/c (5,000×40)

 

 

 

2,00,000

 

  To Security Premium Reserve A/c (5,000×15)

 

 

 

75,000

 

(First call money due)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

2,75,000

 

 

  To Debenture Final and Final call A/c

 

 

 

2,75,000

 

(First Call money Received)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (2,500 × 90)

Dr.

 

2,25,000

 

 

  To Debenture Application & Allotment A/c

 

 

 

2,25,000

 

(Received application money on 2,500 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application & Allotment A/c (2,500 ×90)

Dr.

 

2,25,000

 

 

Discount on Issue of Debentures A/c(2,500×10)

Dr.

 

25,000

 

 

  To 9% Debentures A/c

 

 

 

2,50,000

 

(Transfer of application money to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

Page No 7.49:

Question 8:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (2,500 × 90)

Dr.

 

2,25,000

 

 

  To Debenture Application & Allotment A/c

 

 

 

2,25,000

 

(Received application money on 2,500 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application & Allotment A/c (2,500 ×90)

Dr.

 

2,25,000

 

 

Discount on Issue of Debentures A/c(2,500×10)

Dr.

 

25,000

 

 

  To 9% Debentures A/c

 

 

 

2,50,000

 

(Transfer of application money to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   2,50,000  
 
To Debenture Application A/c
      2,50,000
  (Application money received on 10,000 debentures)        
           
  Debenture Application A/c Dr.   2,50,000  
 
To 10% Debentures A/c
      2,50,000
  (Application money transferred to Debentures Account)      
           
  Debenture Allotment A/c Dr.   6,50,000  
  Discount on Issue of Debentures A/c     1,00,000  
 
To 10% Debentures A/c
      7,50,000
  (Allotment money due on debentures)        
           
  Bank A/c Dr.   6,50,000  
 
To Debenture Allotment A/c
      6,50,000
  (Amount received on allotment)        
           

Page No 7.49:

Question 9:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   2,50,000  
 
To Debenture Application A/c
      2,50,000
  (Application money received on 10,000 debentures)        
           
  Debenture Application A/c Dr.   2,50,000  
 
To 10% Debentures A/c
      2,50,000
  (Application money transferred to Debentures Account)      
           
  Debenture Allotment A/c Dr.   6,50,000  
  Discount on Issue of Debentures A/c     1,00,000  
 
To 10% Debentures A/c
      7,50,000
  (Allotment money due on debentures)        
           
  Bank A/c Dr.   6,50,000  
 
To Debenture Allotment A/c
      6,50,000
  (Amount received on allotment)        
           

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

Incorporation Cost A/c (2,000 × 100)

Dr.

 

2,00,000

 

 

  To 6% Debentures A/c

 

 

 

2,00,000

 

( Debentures issued to promoters)

 

 

 

 

 

 

 

 

 

 

 

Page No 7.49:

Question 10:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

Incorporation Cost A/c (2,000 × 100)

Dr.

 

2,00,000

 

 

  To 6% Debentures A/c

 

 

 

2,00,000

 

( Debentures issued to promoters)

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (5,000 × 110)

Dr.

 

5,50,000

 

 

  To Debenture Application &  Allotment A/c

 

 

 

5,50,000

 

(Received application money on 5,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application &  Allotment A/c (5,000 × 110)

Dr.

 

5,50,000

 

 

  To 8% Debentures A/c (5,000 × 100)

 

 

 

5,00,000

 

  To Securities Premium Reserve A/c (5,000 ×10)

 

 

 

50,000

 

(Transfer of application money to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

 

Underwriting Commission A/c

Dr.

 

27,500

 

 

  To Basu A/c 

(Underwriting Commission made due)

 

 

 

27,500

 

 

 

 

 

 

 

Basu A/c

Dr.

 

27,500

 

 

  To 8% Debentures A/c (250 ×100)

 

 

 

25,000

 

  To Securities Premium Reserve A/c (250×10)

 

 

 

2,500

 

(Debentures issued to Underwriters)

 

 

 

 

Working Notes:

Underwriting Commission=5,50,000×5%=Rs 27,500Number of Debentures to be Issued=27,500110=250 Debentures

Page No 7.49:

Question 11:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (5,000 × 110)

Dr.

 

5,50,000

 

 

  To Debenture Application &  Allotment A/c

 

 

 

5,50,000

 

(Received application money on 5,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application &  Allotment A/c (5,000 × 110)

Dr.

 

5,50,000

 

 

  To 8% Debentures A/c (5,000 × 100)

 

 

 

5,00,000

 

  To Securities Premium Reserve A/c (5,000 ×10)

 

 

 

50,000

 

(Transfer of application money to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

 

Underwriting Commission A/c

Dr.

 

27,500

 

 

  To Basu A/c 

(Underwriting Commission made due)

 

 

 

27,500

 

 

 

 

 

 

 

Basu A/c

Dr.

 

27,500

 

 

  To 8% Debentures A/c (250 ×100)

 

 

 

25,000

 

  To Securities Premium Reserve A/c (250×10)

 

 

 

2,500

 

(Debentures issued to Underwriters)

 

 

 

 

Working Notes:

Underwriting Commission=5,50,000×5%=Rs 27,500Number of Debentures to be Issued=27,500110=250 Debentures

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Entry for all cases        
  Assets A/c Dr.   6,60,000  
  Goodwill A/c (Balancing Figure) Dr.   20,000  
 
To Liabilities A/c
      80,000
 
To Y Ltd.
      6,00,000
  (Purchased assets and liabilities of Y Ltd.)        
           
Case (a) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c
      5,40,000
 
To Cash A/c (10% of 6,00,000)
      60,000
  (Issue of 12% debentures at par)        
           
Case (b) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c (WN1)
      4,50,000
 
To Securities Premium A/c
      90,000
 
To Cash A/c (10% of 6,00,000)
      60,000
  (Issue of 12% debentures at 20% premium)        
           
Case (c) Y Ltd. Dr.   6,00,000  
  Discount on Issue of Debentures A/c (WN2) Dr.   60,000  
 
To 12% Debentures A/c
      6,00,000
 
To Cash A/c (10% of 6,00,000)
      60,000
  (Issue of 12% debentures at 10% discount)        
           

Working Notes:

WN 1: Calculation of number of debentures issued
 
No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=5,40,000 (6,00,00060,000)100+20=4,500

WN 2: Calculation of number of debentures issued
 
No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=5,40,000 (6,00,00060,000)10010=6,000



Page No 7.50:

Question 12:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Entry for all cases        
  Assets A/c Dr.   6,60,000  
  Goodwill A/c (Balancing Figure) Dr.   20,000  
 
To Liabilities A/c
      80,000
 
To Y Ltd.
      6,00,000
  (Purchased assets and liabilities of Y Ltd.)        
           
Case (a) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c
      5,40,000
 
To Cash A/c (10% of 6,00,000)
      60,000
  (Issue of 12% debentures at par)        
           
Case (b) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c (WN1)
      4,50,000
 
To Securities Premium A/c
      90,000
 
To Cash A/c (10% of 6,00,000)
      60,000
  (Issue of 12% debentures at 20% premium)        
           
Case (c) Y Ltd. Dr.   6,00,000  
  Discount on Issue of Debentures A/c (WN2) Dr.   60,000  
 
To 12% Debentures A/c
      6,00,000
 
To Cash A/c (10% of 6,00,000)
      60,000
  (Issue of 12% debentures at 10% discount)        
           

Working Notes:

WN 1: Calculation of number of debentures issued
 
No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=5,40,000 (6,00,00060,000)100+20=4,500

WN 2: Calculation of number of debentures issued
 
No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=5,40,000 (6,00,00060,000)10010=6,000

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Assets A/c Dr.   2,50,000  
  Goodwill A/c (Balancing Figure) Dr.   1,10,000  
 
To Liabilities A/c
      30,000
 
To Goneby Co.
      3,30,000
  (Purchase of Assets and Liabilities of Goneby Ltd.)      
           
  Goneby Co. Dr.   3,30,000  
 
To _ % Debentures A/c
      3,00,000
 
To Securities Premium A/c
      30,000
  (Issue of debentures at 10% premium)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=3,30,000 110=3,000

Page No 7.50:

Question 13:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Assets A/c Dr.   2,50,000  
  Goodwill A/c (Balancing Figure) Dr.   1,10,000  
 
To Liabilities A/c
      30,000
 
To Goneby Co.
      3,30,000
  (Purchase of Assets and Liabilities of Goneby Ltd.)      
           
  Goneby Co. Dr.   3,30,000  
 
To _ % Debentures A/c
      3,00,000
 
To Securities Premium A/c
      30,000
  (Issue of debentures at 10% premium)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=3,30,000 110=3,000

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Sundry Assets A/c Dr.   5,40,000  
 
To A Ltd.
      5,40,000
  (Purchased business of A Ltd.)        
           
  A Ltd. Dr.   5,40,000  
 
To 9% Debentures A/c
      4,00,000
 
To Securities Premium A/c
      40,000
 
To Bank A/c
      1,00,000
  (Payment made to A Ltd partially through cheque and  remaining by issue of 9% debentures at 10% premium)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=4,40,000 110=4,000

Page No 7.50:

Question 14:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Sundry Assets A/c Dr.   5,40,000  
 
To A Ltd.
      5,40,000
  (Purchased business of A Ltd.)        
           
  A Ltd. Dr.   5,40,000  
 
To 9% Debentures A/c
      4,00,000
 
To Securities Premium A/c
      40,000
 
To Bank A/c
      1,00,000
  (Payment made to A Ltd partially through cheque and  remaining by issue of 9% debentures at 10% premium)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=4,40,000 110=4,000

Answer:

Journal
Date Particulars L.F. Debit Amount (Rs) Credit Amount (Rs)
  Machinery A/c Dr.   6,30,000  
 
To B’s A/c
      6,30,000
  (Machinery purchased from B)        
           
  B’s A/c Dr.   6,30,000  
 
To 10% Debentures A/c
      6,00,000
 
To Securities Premium A/c
      30,000
  (Issued 10% debentures at 5% premium to B for purchase consideration)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=6,30,000  105= 6,000 

Page No 7.50:

Question 15:

Journal
Date Particulars L.F. Debit Amount (Rs) Credit Amount (Rs)
  Machinery A/c Dr.   6,30,000  
 
To B’s A/c
      6,30,000
  (Machinery purchased from B)        
           
  B’s A/c Dr.   6,30,000  
 
To 10% Debentures A/c
      6,00,000
 
To Securities Premium A/c
      30,000
  (Issued 10% debentures at 5% premium to B for purchase consideration)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=6,30,000  105= 6,000 

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Plant and Machinery A/c Dr.   10,00,000  
 
To Vendor’s A/c
      10,00,000
  (Purchased plant and machinery from the vendor)        
           
  Vendor’s A/c Dr.   10,00,000  
  Discount on Issue of Debentures A/c Dr.   75,000  
 
To 10% Debenture A/c
      7,50,000
 
To Cash A/c
      3,25,000
  (Payment made to vendor partially in cash and  remaining by issue of 10% debentures at 10% discount)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=6,75,000 (10,00,0003,25,000) 900 (1,000 - 100)= 750 

Page No 7.50:

Question 16:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Plant and Machinery A/c Dr.   10,00,000  
 
To Vendor’s A/c
      10,00,000
  (Purchased plant and machinery from the vendor)        
           
  Vendor’s A/c Dr.   10,00,000  
  Discount on Issue of Debentures A/c Dr.   75,000  
 
To 10% Debenture A/c
      7,50,000
 
To Cash A/c
      3,25,000
  (Payment made to vendor partially in cash and  remaining by issue of 10% debentures at 10% discount)      
           

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = Purchase ConsiderationIssue Price of Debentures=6,75,000 (10,00,0003,25,000) 900 (1,000 - 100)= 750 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Assets A/c

Dr.

 

4,00,000

 

 

Goodwill A/c (balancing figure)

Dr.

 

30,000

 

 

To Liabilities A/c

 

 

50,000

 

To Mohan Bros. A/c

 

 

3,80,000

 

(Asset and liabilities purchased from Mohan Bros.)

 

 

 

 

 

 

 

 


For issuing Debentures at 10% discount
Journal
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Mohan Bros.
Dr.
 
3,80,000
 
 
Discount on issue of Debenture A/c
Dr.
 
42,220
 
 
To Debenture A/c
 
 
4,22,200
 
To Bank A/c
 
 
20
 
(Issued 4,222 Debentures of Rs 100 each at 10% discount to Mohan Bros. and fraction of debentures is paid in cash)
 
 
 
 
 
 
 
 

 

Working Note:

Page No 7.50:

Question 17:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Assets A/c

Dr.

 

4,00,000

 

 

Goodwill A/c (balancing figure)

Dr.

 

30,000

 

 

To Liabilities A/c

 

 

50,000

 

To Mohan Bros. A/c

 

 

3,80,000

 

(Asset and liabilities purchased from Mohan Bros.)

 

 

 

 

 

 

 

 


For issuing Debentures at 10% discount
Journal
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Mohan Bros.
Dr.
 
3,80,000
 
 
Discount on issue of Debenture A/c
Dr.
 
42,220
 
 
To Debenture A/c
 
 
4,22,200
 
To Bank A/c
 
 
20
 
(Issued 4,222 Debentures of Rs 100 each at 10% discount to Mohan Bros. and fraction of debentures is paid in cash)
 
 
 
 
 
 
 
 

 

Working Note:

Answer:

Books of R Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Assets A/c

Dr.

 

5,00,000

 

 

To Liabilities A/c

 

 

2,00,000

 

To S Ltd.

 

 

2,80,000

 

To Capital Reserve A/c (balancing figure)

 

 

20,000

 

(Asset purchased and liabilities took over from S Ltd.)

 

 

 

 

 

 

 

 

 

S Ltd.

Dr.

 

2,80,000

 

 

To 9% Debentures A/c

 

 

2,80,000

 

(Issued 2,800 9% Debentures of Rs 100 each)

 

 

 

 

 

 

 

 


Working Note:

Page No 7.50:

Question 18:

Books of R Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Assets A/c

Dr.

 

5,00,000

 

 

To Liabilities A/c

 

 

2,00,000

 

To S Ltd.

 

 

2,80,000

 

To Capital Reserve A/c (balancing figure)

 

 

20,000

 

(Asset purchased and liabilities took over from S Ltd.)

 

 

 

 

 

 

 

 

 

S Ltd.

Dr.

 

2,80,000

 

 

To 9% Debentures A/c

 

 

2,80,000

 

(Issued 2,800 9% Debentures of Rs 100 each)

 

 

 

 

 

 

 

 


Working Note:

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
(i) Bank A/c Dr.   5,00,000  
 
To Debenture Application and Allotment A/c
      5,00,000
  (Money on Application and Allotment received)        
           
  Debenture Application and Allotment A/c Dr.   5,00,000  
 
To 10% Debentures A/c
      5,00,000
  (Money transferred to 10% Debentures Account)        
           
(ii) Fixed Assets A/c Dr.   5,50,000  
 
To Vendor’s A/c
      5,50,000
  (Purchased fixed assets from vendor)         
           
  Vendor’s A/c Dr.   5,50,000  
 
To 10% Debentures A/c
      5,00,000
    To Securities Premium A/c       50,000
  (Debentures issued to vendor for purchase of assets)      
           

Page No 7.50:

Question 19:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
(i) Bank A/c Dr.   5,00,000  
 
To Debenture Application and Allotment A/c
      5,00,000
  (Money on Application and Allotment received)        
           
  Debenture Application and Allotment A/c Dr.   5,00,000  
 
To 10% Debentures A/c
      5,00,000
  (Money transferred to 10% Debentures Account)        
           
(ii) Fixed Assets A/c Dr.   5,50,000  
 
To Vendor’s A/c
      5,50,000
  (Purchased fixed assets from vendor)         
           
  Vendor’s A/c Dr.   5,50,000  
 
To 10% Debentures A/c
      5,00,000
    To Securities Premium A/c       50,000
  (Debentures issued to vendor for purchase of assets)      
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Entry for all cases        
  Assets A/c Dr.   6,60,000  
  Goodwill A/c (Balancing Figure) Dr.   20,000  
 
To Liabilities A/c
      80,000
 
To Y Ltd.
      6,00,000
  (Purchased assets and liabilities of Y Ltd.)        
           
Case (a) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c (5,400 × 100)
      5,40,000
 
To Bank A/c (10% of 6,00,000)
      60,000
  (Cash paid to Y Ltd. and for the remaining 5,400 12% Debentures issued at par)      
           
Case (b) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c (4,500 × 100)
      4,50,000
 
To Securities Premium A/c (4,500 × 20)
      90,000
 
To Bank A/c (10% of 6,00,000)
      60,000
  (Cash paid to Y Ltd. and for the remaining 5,400 12% Debentures issued at 20% premium)      
           

Page No 7.50:

Question 20:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Entry for all cases        
  Assets A/c Dr.   6,60,000  
  Goodwill A/c (Balancing Figure) Dr.   20,000  
 
To Liabilities A/c
      80,000
 
To Y Ltd.
      6,00,000
  (Purchased assets and liabilities of Y Ltd.)        
           
Case (a) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c (5,400 × 100)
      5,40,000
 
To Bank A/c (10% of 6,00,000)
      60,000
  (Cash paid to Y Ltd. and for the remaining 5,400 12% Debentures issued at par)      
           
Case (b) Y Ltd. Dr.   6,00,000  
 
To 12% Debentures A/c (4,500 × 100)
      4,50,000
 
To Securities Premium A/c (4,500 × 20)
      90,000
 
To Bank A/c (10% of 6,00,000)
      60,000
  (Cash paid to Y Ltd. and for the remaining 5,400 12% Debentures issued at 20% premium)      
           

Answer:

When Debentures Issued as Collateral Security are shown separately
 

Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
4,00,000
 
 
To Loan from Mahavir Bank Ltd.
 
 
4,00,000
 
(Loan taken against issuing 8% Debentures as collateral security)
 
 
 
 
 
 
 
 
 
Debenture Suspense A/c
Dr.
 
4,00,000
 
 
To 8% Debenture A/c
 
 
4,00,000
 
(Debentures issued as collateral security)
 
 
 
 
 
 
 
 

Posting in the Company's Balance Sheet (When Debentures Issued as Collateral Security are shown separately)
 
Balance Sheet
Particulars
Note No.
Amount 
(Rs)
I Equity and Liabilities
 
 
1.Shareholders’ Funds
 
 
2.Non-Current Liabilities
 
 
a. Long-Term Borrowings
1
4,00,000
3.Current Liabilities
 
 
Total
 
4,00,000
 
 
 
II Assets
 
 
1. Non-Current Assets
 
 
2. Current Assets
 
 
a. Cash and Cash Equivalents
2
4,00,000
Total
 
4,00,000
 
 
 

NOTES TO ACCOUNTS
Note No.
Particulars
Amount
(Rs)
 
 
 
1
Long-Term Borrowings
 
 
Secured:
 
 
Loan  From Mahavir Bank (Secured by issue of  Debentures of Rs 4,00,000)
4,00,000
 
8% Debentures (Issued as Collateral Security to Bank against Loan)
 
4,00,000
 
 
 
Less: Debenture Suspense Account
4,00,000
-
 
 
4,00,000
2
Cash and Cash Equivalents
 
 
Cash at Bank
4,00,000
 
 
 

Alternative Method: When debentures Issued as Collateral Security are not shown separately
 
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
4,00,000
 
 
To Loan From Mahavir Bank Ltd.
 
 
4,00,000
 
(Loan taken from Mahavir Bank secured by issuing Debentures as collateral security)
 
 
 
 
 
 
 
 

(When Debentures Issued as Collateral Security are not shown separately)
 
Balance Sheet
Particulars
Note No.
Amount 
(Rs)
I. Equity and Liabilities
 
 
1. Shareholders’ Funds
 
 
2. Non-Current Liabilities
 
 
a. Long-Term Borrowings
1
4,00,000
3. Current Liabilities
 
 
Total
 
4,00,000
 
 
 
II. Assets
 
 
1. Non-Current Assets
 
 
2. Current Assets
 
 
a. Cash and Cash Equivalents
2
4,00,000
Total
 
4,00,000
 
 
 

NOTES TO ACCOUNTS
 
Note No.
Particulars
Amount
(Rs)
 
 
 
1
Long-Term Borrowings
 
 
Secured:
 
 
Loan From Mahavir Bank (Secured by issue of  8% Debentures of Rs 4,00,000 as Collateral Security)
 
4,00,000
 
 
 
2
Cash and Cash Equivalents
 
 
Cash at Bank
4,00,000
 
 
 

Page No 7.50:

Question 21:

When Debentures Issued as Collateral Security are shown separately
 

Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
4,00,000
 
 
To Loan from Mahavir Bank Ltd.
 
 
4,00,000
 
(Loan taken against issuing 8% Debentures as collateral security)
 
 
 
 
 
 
 
 
 
Debenture Suspense A/c
Dr.
 
4,00,000
 
 
To 8% Debenture A/c
 
 
4,00,000
 
(Debentures issued as collateral security)
 
 
 
 
 
 
 
 

Posting in the Company's Balance Sheet (When Debentures Issued as Collateral Security are shown separately)
 
Balance Sheet
Particulars
Note No.
Amount 
(Rs)
I Equity and Liabilities
 
 
1.Shareholders’ Funds
 
 
2.Non-Current Liabilities
 
 
a. Long-Term Borrowings
1
4,00,000
3.Current Liabilities
 
 
Total
 
4,00,000
 
 
 
II Assets
 
 
1. Non-Current Assets
 
 
2. Current Assets
 
 
a. Cash and Cash Equivalents
2
4,00,000
Total
 
4,00,000
 
 
 

NOTES TO ACCOUNTS
Note No.
Particulars
Amount
(Rs)
 
 
 
1
Long-Term Borrowings
 
 
Secured:
 
 
Loan  From Mahavir Bank (Secured by issue of  Debentures of Rs 4,00,000)
4,00,000
 
8% Debentures (Issued as Collateral Security to Bank against Loan)
 
4,00,000
 
 
 
Less: Debenture Suspense Account
4,00,000
-
 
 
4,00,000
2
Cash and Cash Equivalents
 
 
Cash at Bank
4,00,000
 
 
 

Alternative Method: When debentures Issued as Collateral Security are not shown separately
 
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
4,00,000
 
 
To Loan From Mahavir Bank Ltd.
 
 
4,00,000
 
(Loan taken from Mahavir Bank secured by issuing Debentures as collateral security)
 
 
 
 
 
 
 
 

(When Debentures Issued as Collateral Security are not shown separately)
 
Balance Sheet
Particulars
Note No.
Amount 
(Rs)
I. Equity and Liabilities
 
 
1. Shareholders’ Funds
 
 
2. Non-Current Liabilities
 
 
a. Long-Term Borrowings
1
4,00,000
3. Current Liabilities
 
 
Total
 
4,00,000
 
 
 
II. Assets
 
 
1. Non-Current Assets
 
 
2. Current Assets
 
 
a. Cash and Cash Equivalents
2
4,00,000
Total
 
4,00,000
 
 
 

NOTES TO ACCOUNTS
 
Note No.
Particulars
Amount
(Rs)
 
 
 
1
Long-Term Borrowings
 
 
Secured:
 
 
Loan From Mahavir Bank (Secured by issue of  8% Debentures of Rs 4,00,000 as Collateral Security)
 
4,00,000
 
 
 
2
Cash and Cash Equivalents
 
 
Cash at Bank
4,00,000
 
 
 

Answer:

As per the Schedule III of the Companies Act, 2013, the Company’s Balance Sheet is as follows.
 

Exe Ltd.

Balance Sheet

Particulars

Note No.

Amount 

(Rs)

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

2. Non-Current Liabilities

 

 

a. Long-Term Borrowings

1

5,00,000

3. Current Liabilities

 

 

Total

 

5,00,000

 

 

 

II. Assets

 

 

1. Non-Current Assets

 

 

2. Current Assets

 

 

a. Cash and Cash Equivalents

2

5,00,000

Total

 

5,00,000

 

 

 


NOTES TO ACCOUNTS

Note No.

Particulars

Amount

(Rs)

1

Long-Term Borrowings

 

 

Loan (Secured by issue of  9% Debentures of Rs 6,00,000 as Collateral Security)

 

5,00,000

 

 

 

2

Cash and Cash Equivalents

 

 

Cash at Bank

5,00,000

 

 

 

 

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

5,00,000

 

 

To Loan A/c

 

 

5,00,000

 

(Loan taken against issuing 9% Debentures as collateral Security)

 

 

 

 

 

 

 

 


Alternative Method:

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

5,00,000

 

 

To Loan A/c

 

 

5,00,000

 

(Loan taken against issuing 9% debentures as collateral Security)

 

 

 

 

 

 

 

 

 

Debenture Suspense A/c

Dr.

 

6,00,000

 

 

To 9% Debentures A/c

 

 

6,00,000

 

(Issued 9% Debentures of Rs 6,00,000 as collateral security)

 

 

 

 

 

 

 

 


Posting in the Company's Balance Sheet
 

Exe Ltd.

Balance Sheet

Particulars

Note No.

Amount 

(Rs)

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

2. Non-Current Liabilities

 

 

a. Long-Term Borrowings

1

5,00,000

3. Current Liabilities

 

 

Total

 

5,00,000

 

 

 

II. Assets

 

 

1. Non-Current Assets

 

 

2. Current Assets

 

 

a. Cash and Cash Equivalents

2

5,00,000

Total

 

5,00,000

 

 

 

 

NOTES TO ACCOUNTS
Note No.
Particulars
Amount
(Rs)
1
Long-Term Borrowings
 
 
Secured:
 
 
Loan (Secured by issue of  9% Debentures of
Rs 6,00,000 as Collateral Security)
 
5,00,000
 
9% Debentures (Issued as Collateral Security to Bank against loan)

6,00,000
 
 
 
Less: Debenture Suspense Account
6,00,000
-
 
 
5,00,000
2
Cash and Cash Equivalents
 
 
Cash at Bank
5,00,000

 

 

 

Page No 7.50:

Question 22:

As per the Schedule III of the Companies Act, 2013, the Company’s Balance Sheet is as follows.
 

Exe Ltd.

Balance Sheet

Particulars

Note No.

Amount 

(Rs)

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

2. Non-Current Liabilities

 

 

a. Long-Term Borrowings

1

5,00,000

3. Current Liabilities

 

 

Total

 

5,00,000

 

 

 

II. Assets

 

 

1. Non-Current Assets

 

 

2. Current Assets

 

 

a. Cash and Cash Equivalents

2

5,00,000

Total

 

5,00,000

 

 

 


NOTES TO ACCOUNTS

Note No.

Particulars

Amount

(Rs)

1

Long-Term Borrowings

 

 

Loan (Secured by issue of  9% Debentures of Rs 6,00,000 as Collateral Security)

 

5,00,000

 

 

 

2

Cash and Cash Equivalents

 

 

Cash at Bank

5,00,000

 

 

 

 

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

5,00,000

 

 

To Loan A/c

 

 

5,00,000

 

(Loan taken against issuing 9% Debentures as collateral Security)

 

 

 

 

 

 

 

 


Alternative Method:

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

5,00,000

 

 

To Loan A/c

 

 

5,00,000

 

(Loan taken against issuing 9% debentures as collateral Security)

 

 

 

 

 

 

 

 

 

Debenture Suspense A/c

Dr.

 

6,00,000

 

 

To 9% Debentures A/c

 

 

6,00,000

 

(Issued 9% Debentures of Rs 6,00,000 as collateral security)

 

 

 

 

 

 

 

 


Posting in the Company's Balance Sheet
 

Exe Ltd.

Balance Sheet

Particulars

Note No.

Amount 

(Rs)

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

2. Non-Current Liabilities

 

 

a. Long-Term Borrowings

1

5,00,000

3. Current Liabilities

 

 

Total

 

5,00,000

 

 

 

II. Assets

 

 

1. Non-Current Assets

 

 

2. Current Assets

 

 

a. Cash and Cash Equivalents

2

5,00,000

Total

 

5,00,000

 

 

 

 

NOTES TO ACCOUNTS
Note No.
Particulars
Amount
(Rs)
1
Long-Term Borrowings
 
 
Secured:
 
 
Loan (Secured by issue of  9% Debentures of
Rs 6,00,000 as Collateral Security)
 
5,00,000
 
9% Debentures (Issued as Collateral Security to Bank against loan)

6,00,000
 
 
 
Less: Debenture Suspense Account
6,00,000
-
 
 
5,00,000
2
Cash and Cash Equivalents
 
 
Cash at Bank
5,00,000

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit 

Amount

Rs

Credit Amount

Rs

(a)

Bank A/c

Dr.

 

95

 

 

To Debenture Application A/c

 

 

95

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

95

 

 

Discount on Issue of Debentures A/c

 

 

5

 

 

To Debenture A/c

 

 

100

 

(Debenture of Rs 100 each issued at Rs 95 with the term repayable at par)

 

 

 

 

 

 

 

 

(b)

Bank A/c

Dr.

 

95

 

 

To Debenture Application A/c

 

 

95

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

95

 

 

Discount on Issue of Debentures A/c

Dr.

 

5

 

 

Loss on Issue of Debentures A/c

Dr.

 

5

 

 

To Debentures A/c

 

 

100

 

To Premium on Redemption A/c

 

 

5

 

(Debenture of Rs 100 each issued of Rs 95 with the term repayable at Rs 105)

 

 

 

 

 

 

 

 

(c)

Bank A/c

Dr.

 

100

 

 

To Debenture Application A/c

 

 

100

 

(Debenture Application received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

100

 

 

Loss on Issue of Debentures A/c

Dr.

 

5

 

 

To Debentures A/c

 

 

100

 

To Premium on Redemption A/c

 

 

5

 

(Debenture of Rs 100 each issued at par with the term repayable at Rs 105)

 

 

 

 

 

 

 

 



Page No 7.51:

Question 23:

Journal

Date

Particulars

L.F.

Debit 

Amount

Rs

Credit Amount

Rs

(a)

Bank A/c

Dr.

 

95

 

 

To Debenture Application A/c

 

 

95

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

95

 

 

Discount on Issue of Debentures A/c

 

 

5

 

 

To Debenture A/c

 

 

100

 

(Debenture of Rs 100 each issued at Rs 95 with the term repayable at par)

 

 

 

 

 

 

 

 

(b)

Bank A/c

Dr.

 

95

 

 

To Debenture Application A/c

 

 

95

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

95

 

 

Discount on Issue of Debentures A/c

Dr.

 

5

 

 

Loss on Issue of Debentures A/c

Dr.

 

5

 

 

To Debentures A/c

 

 

100

 

To Premium on Redemption A/c

 

 

5

 

(Debenture of Rs 100 each issued of Rs 95 with the term repayable at Rs 105)

 

 

 

 

 

 

 

 

(c)

Bank A/c

Dr.

 

100

 

 

To Debenture Application A/c

 

 

100

 

(Debenture Application received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

100

 

 

Loss on Issue of Debentures A/c

Dr.

 

5

 

 

To Debentures A/c

 

 

100

 

To Premium on Redemption A/c

 

 

5

 

(Debenture of Rs 100 each issued at par with the term repayable at Rs 105)

 

 

 

 

 

 

 

 

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   10,00,000  
 
To Debenture Application and Allotment A/c
      10,00,000
  Applications received for 10,000, debentures of Rs 100 each)      
           
  Debenture Application and Allotment A/c Dr.   10,00,000  
  Loss on Issue of Debentures A/c Dr.   1,00,000  
 
To _% Debentures A/c
      10,00,000
 
To Premium on Redemption of Debentures A/c
      1,00,000
  (Debentures issued at par and redeemable at premium)      
           

Page No 7.51:

Question 24:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   10,00,000  
 
To Debenture Application and Allotment A/c
      10,00,000
  Applications received for 10,000, debentures of Rs 100 each)      
           
  Debenture Application and Allotment A/c Dr.   10,00,000  
  Loss on Issue of Debentures A/c Dr.   1,00,000  
 
To _% Debentures A/c
      10,00,000
 
To Premium on Redemption of Debentures A/c
      1,00,000
  (Debentures issued at par and redeemable at premium)      
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   1,00,000  
 
To Debenture Application and Allotment A/c
      1,00,000
  (Applications received for Rs 1,00,000, 7% debentures)      
           
  Debenture Application and Allotment A/c Dr.   1,00,000  
  Loss on Issue of Debentures A/c Dr.   5,000  
 
To 7% Debentures A/c
      1,00,000
 
To Premium on Redemption of Debentures A/c
      5,000
  (Debentures issued at par and redeemable at premium)        
           

Page No 7.51:

Question 25:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   1,00,000  
 
To Debenture Application and Allotment A/c
      1,00,000
  (Applications received for Rs 1,00,000, 7% debentures)      
           
  Debenture Application and Allotment A/c Dr.   1,00,000  
  Loss on Issue of Debentures A/c Dr.   5,000  
 
To 7% Debentures A/c
      1,00,000
 
To Premium on Redemption of Debentures A/c
      5,000
  (Debentures issued at par and redeemable at premium)        
           

Answer:

(i)

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   2,00,00,000  
 
To Debenture Application and Allotment A/c
      2,00,00,000
  (Applications received for 4,00,000, 9% debentures of Rs 50 each)      
           
  Debenture Application and Allotment A/c Dr.   2,00,00,000  
  Loss on Issue of Debentures A/c Dr.   20,00,000  
 
To 9% Debentures A/c
      2,00,00,000
 
To Premium on Redemption of Debentures A/c
      20,00,000
  (Debentures issued at par and redeemable at premium)      
           

(ii)
Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   2,10,00,000  
 
To Debenture Application and Allotment A/c
      2,10,00,000
  (Applications received for 4,00,000, 9% debentures of Rs 50 each)      
           
  Debenture Application and Allotment A/c Dr.   2,10,00,000  
  Loss on Issue of Debentures A/c Dr.   20,00,000  
 
To 9% Debentures A/c
      2,00,00,000
 
To Premium on Redemption of Debentures A/c
      20,00,000
 
To Securities Premium A/c
      10,00,000
  (Debentures issued at premium and redeemable at premium)      
           

Page No 7.51:

Question 26:

(i)

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   2,00,00,000  
 
To Debenture Application and Allotment A/c
      2,00,00,000
  (Applications received for 4,00,000, 9% debentures of Rs 50 each)      
           
  Debenture Application and Allotment A/c Dr.   2,00,00,000  
  Loss on Issue of Debentures A/c Dr.   20,00,000  
 
To 9% Debentures A/c
      2,00,00,000
 
To Premium on Redemption of Debentures A/c
      20,00,000
  (Debentures issued at par and redeemable at premium)      
           

(ii)
Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   2,10,00,000  
 
To Debenture Application and Allotment A/c
      2,10,00,000
  (Applications received for 4,00,000, 9% debentures of Rs 50 each)      
           
  Debenture Application and Allotment A/c Dr.   2,10,00,000  
  Loss on Issue of Debentures A/c Dr.   20,00,000  
 
To 9% Debentures A/c
      2,00,00,000
 
To Premium on Redemption of Debentures A/c
      20,00,000
 
To Securities Premium A/c
      10,00,000
  (Debentures issued at premium and redeemable at premium)      
           

Answer:

Books of Footfall Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

9,00,000

 

 

To Debenture Application A/c

 

 

9,00,000

 

(Debenture application money received for 10,000 debentures at Rs 90 each)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

9,00,000

 

 

Discount on Issue of Debenture A/c

Dr.

 

1,00,000

 

 

Loss on issue of Debentures A/c

Dr.

 

50,000

 

 

To Debentures A/c

 

 

10,00,000

 

To Premium on Redemption A/c

 

 

50,000

 

(10,000 Debentures of Rs 100 each issued at 10% discount with the term repayable at 5% redemption)

 

 

 

 

 

 

 

 

 

Debentures A/c

Dr.

 

10,00,000

 

 

Premium on Redemption A/c

Dr.

 

50,000

 

 

To Debentureholders’ A/c

 

 

10,50,000

 

(Debentures due for redemption along with premium on redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,50,000

 

 

To Bank A/c

 

 

10,50,000

 

(Amount due for redemption paid to debenture holders)

 

 

 

 

 

 

 

 

Page No 7.51:

Question 27:

Books of Footfall Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

 

Bank A/c

Dr.

 

9,00,000

 

 

To Debenture Application A/c

 

 

9,00,000

 

(Debenture application money received for 10,000 debentures at Rs 90 each)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

9,00,000

 

 

Discount on Issue of Debenture A/c

Dr.

 

1,00,000

 

 

Loss on issue of Debentures A/c

Dr.

 

50,000

 

 

To Debentures A/c

 

 

10,00,000

 

To Premium on Redemption A/c

 

 

50,000

 

(10,000 Debentures of Rs 100 each issued at 10% discount with the term repayable at 5% redemption)

 

 

 

 

 

 

 

 

 

Debentures A/c

Dr.

 

10,00,000

 

 

Premium on Redemption A/c

Dr.

 

50,000

 

 

To Debentureholders’ A/c

 

 

10,50,000

 

(Debentures due for redemption along with premium on redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,50,000

 

 

To Bank A/c

 

 

10,50,000

 

(Amount due for redemption paid to debenture holders)

 

 

 

 

 

 

 

 

Answer:

Journal
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
9,00,000
 
 
To Debenture Application A/c
 
 
9,00,000
 
(Debenture application money received for 10,000 debentures at Rs 90 each)
 
 
 
 
 
 
 
 
 
Debenture Application A/c
Dr.
 
9,00,000
 
 
Discount on Issue of Debenture A/c
Dr.
 
1,00,000
 
 
Loss on Issue of Debenture A/c
Dr.
 
1,00,000
 
 
To Debentures A/c
 
 
10,00,000
 
To Premium on Redemption A/c
 
 
1,00,000
 
(10,000 Debenture of Rs 100 each issued at 10% discount with the term repayable at a premium of 10%)
 
 
 
 
 
 
 
 
 
Debentures A/c
Dr.
 
10,00,000
 
 
Premium on Redemption A/c
Dr.
 
1,00,000
 
 
To Debentureholders’ A/c
 
 
11,00,000
 
(Amount of Debentures due for redemption along with premium on redemption)
 
 
 
 
 
 
 
 
 
Debentureholders’ A/c
Dr.
 
11,00,000
 
 
To Bank A/c
 
 
11,00,000
 
(Amount due for redemption paid to debenture holders)
 
 
 
 
 
 
 
 

Page No 7.51:

Question 28:

Journal
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
9,00,000
 
 
To Debenture Application A/c
 
 
9,00,000
 
(Debenture application money received for 10,000 debentures at Rs 90 each)
 
 
 
 
 
 
 
 
 
Debenture Application A/c
Dr.
 
9,00,000
 
 
Discount on Issue of Debenture A/c
Dr.
 
1,00,000
 
 
Loss on Issue of Debenture A/c
Dr.
 
1,00,000
 
 
To Debentures A/c
 
 
10,00,000
 
To Premium on Redemption A/c
 
 
1,00,000
 
(10,000 Debenture of Rs 100 each issued at 10% discount with the term repayable at a premium of 10%)
 
 
 
 
 
 
 
 
 
Debentures A/c
Dr.
 
10,00,000
 
 
Premium on Redemption A/c
Dr.
 
1,00,000
 
 
To Debentureholders’ A/c
 
 
11,00,000
 
(Amount of Debentures due for redemption along with premium on redemption)
 
 
 
 
 
 
 
 
 
Debentureholders’ A/c
Dr.
 
11,00,000
 
 
To Bank A/c
 
 
11,00,000
 
(Amount due for redemption paid to debenture holders)
 
 
 
 
 
 
 
 

Answer:

Journal
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
95,000
 
 
To 9% Debenture Application A/c
 
 
95,000
 
(Debenture application money received)
 
 
 
 
 
 
 
 
 
9% Debenture Application A/c
Dr.
 
95,000
 
 
Discount on Issue of Debentures A/c
Dr.
 
5,000
 
 
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
 
(9% Debentures issued at 5% discount with term repayable at 10% premium)
 
 
 
 
 
 
 
 

Page No 7.51:

Question 29:

Journal
Date
Particulars
L.F.
Debit Amount
Rs
Credit Amount
Rs
 
Bank A/c
Dr.
 
95,000
 
 
To 9% Debenture Application A/c
 
 
95,000
 
(Debenture application money received)
 
 
 
 
 
 
 
 
 
9% Debenture Application A/c
Dr.
 
95,000
 
 
Discount on Issue of Debentures A/c
Dr.
 
5,000
 
 
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
 
(9% Debentures issued at 5% discount with term repayable at 10% premium)
 
 
 
 
 
 
 
 

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   75,00,000  
 
To Debenture Application and Allotment A/c
      75,00,000
  (Applications received for 75,000, 8% debentures of Rs 100 each)      
           
  Debenture Application and Allotment A/c Dr.   75,00,000  
 
To 8% Debentures A/c
      75,00,000
  (Debentures issued at par, redeemable at par)        
           

Page No 7.51:

Question 30:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   75,00,000  
 
To Debenture Application and Allotment A/c
      75,00,000
  (Applications received for 75,000, 8% debentures of Rs 100 each)      
           
  Debenture Application and Allotment A/c Dr.   75,00,000  
 
To 8% Debentures A/c
      75,00,000
  (Debentures issued at par, redeemable at par)        
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   18,40,000  
 
To Debenture Application and Allotment A/c
      18,40,000
  (Applications received for 40,000, 9% debentures of Rs 50 each at a discount of 8%)      
           
  Debenture Application and Allotment A/c Dr.   18,40,000  
  Discount on Issue of Debentures A/c Dr.   1,60,000  
 
To 9% Debentures A/c
      20,00,000
  (Debentures issued at discount, redeemable at par)      
           

Page No 7.51:

Question 31:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   18,40,000  
 
To Debenture Application and Allotment A/c
      18,40,000
  (Applications received for 40,000, 9% debentures of Rs 50 each at a discount of 8%)      
           
  Debenture Application and Allotment A/c Dr.   18,40,000  
  Discount on Issue of Debentures A/c Dr.   1,60,000  
 
To 9% Debentures A/c
      20,00,000
  (Debentures issued at discount, redeemable at par)      
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   1,05,000  
 
To Debenture Application and Allotment A/c
      1,05,000
  (Applications received for Rs 1,00,000, 9% debentures at a premium of 5%)      
           
  Debenture Application and Allotment A/c Dr.   1,05,000  
 
To 9% Debentures A/c
      1,00,000
 
To Securities Premium A/c
      5,000
  (Debentures issued at premium, redeemable at par)      
           

Page No 7.51:

Question 32:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   1,05,000  
 
To Debenture Application and Allotment A/c
      1,05,000
  (Applications received for Rs 1,00,000, 9% debentures at a premium of 5%)      
           
  Debenture Application and Allotment A/c Dr.   1,05,000  
 
To 9% Debentures A/c
      1,00,000
 
To Securities Premium A/c
      5,000
  (Debentures issued at premium, redeemable at par)      
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   80,00,000  
 
To Debenture Application and Allotment A/c
      80,00,000
  (Applications received for Rs 80,00,000, 9% debentures at par)      
           
  Debenture Application and Allotment A/c Dr.   80,00,000  
  Loss on Issue of Debentures A/c Dr.   8,00,000  
 
To 9% Debentures A/c
      80,00,000
 
To Premium on Redemption of Debentures A/c
      8,00,000
  (Debentures issued at par and redeemable at premium)      
           

Page No 7.51:

Question 33:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   80,00,000  
 
To Debenture Application and Allotment A/c
      80,00,000
  (Applications received for Rs 80,00,000, 9% debentures at par)      
           
  Debenture Application and Allotment A/c Dr.   80,00,000  
  Loss on Issue of Debentures A/c Dr.   8,00,000  
 
To 9% Debentures A/c
      80,00,000
 
To Premium on Redemption of Debentures A/c
      8,00,000
  (Debentures issued at par and redeemable at premium)      
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
2014          
April 01 Bank A/c Dr.   2,00,000  
 
To Debenture Application A/c
      2,00,000
  (Application money received on 50,000, 9% debentures @ Rs 4 per debenture)      
           
  Debenture Application A/c Dr.   2,00,000  
 
To 9% Debentures A/c
      2,00,000
  (Application money transferred to 9% Debentures Account)      
           
  Debenture Allotment A/c Dr.   3,00,000  
  Loss on Issue of Debentures A/c Dr.   50,000  
 
To 9% Debentures A/c
      3,00,000
 
To Premium on Redemption of Debentures A/c
      50,000
  (Debentures issued at par and redeemable at premium)      
           
  Bank A/c Dr.   3,00,000  
 
To Debenture Allotment A/c
      3,00,000
  (Allotment money received on allotment @ Rs 6 per debenture)      
           

Page No 7.51:

Question 34:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
2014          
April 01 Bank A/c Dr.   2,00,000  
 
To Debenture Application A/c
      2,00,000
  (Application money received on 50,000, 9% debentures @ Rs 4 per debenture)      
           
  Debenture Application A/c Dr.   2,00,000  
 
To 9% Debentures A/c
      2,00,000
  (Application money transferred to 9% Debentures Account)      
           
  Debenture Allotment A/c Dr.   3,00,000  
  Loss on Issue of Debentures A/c Dr.   50,000  
 
To 9% Debentures A/c
      3,00,000
 
To Premium on Redemption of Debentures A/c
      50,000
  (Debentures issued at par and redeemable at premium)      
           
  Bank A/c Dr.   3,00,000  
 
To Debenture Allotment A/c
      3,00,000
  (Allotment money received on allotment @ Rs 6 per debenture)      
           

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   7,35,000  
 
To Debenture Application and Allotment A/c
      7,35,000
  (Applications received for 7,000, 10% debentures of Rs 100 each at a premium of 5%)      
           
  Debenture Application and Allotment A/c Dr.   7,35,000  
  Loss on Issue of Debentures A/c Dr.   70,000  
 
To 10% Debentures A/c
      7,00,000
 
To Premium on Redemption of Debentures A/c
      70,000
 
To Securities Premium A/c
      35,000
  (Debentures issued at premium and redeemable at premium)      
           

Page No 7.51:

Question 35:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Bank A/c Dr.   7,35,000  
 
To Debenture Application and Allotment A/c
      7,35,000
  (Applications received for 7,000, 10% debentures of Rs 100 each at a premium of 5%)      
           
  Debenture Application and Allotment A/c Dr.   7,35,000  
  Loss on Issue of Debentures A/c Dr.   70,000  
 
To 10% Debentures A/c
      7,00,000
 
To Premium on Redemption of Debentures A/c
      70,000
 
To Securities Premium A/c
      35,000
  (Debentures issued at premium and redeemable at premium)      
           

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)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

44,000

 

 

Loss on Issue of Debenture 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

 

(Debentures of Rs 40,000 issued at 10% premium with the term redeemable at 110%)

 

 

 

 

 

 

 

 

Page No 7.51:

Question 36:

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)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

44,000

 

 

Loss on Issue of Debenture 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

 

(Debentures of Rs 40,000 issued at 10% premium with the term redeemable at 110%)

 

 

 

 

 

 

 

 

Answer:

Books of XYZ Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

2016

 

 

 

 

April 01

Bank A/c

Dr.

 

5,00,000

 

 

To Debenture Application A/c

 

 

 

5,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

 

April 01

Debenture Application A/c

Dr.

 

5,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

To 10% Debentures A/c

 

 

 

5,00,000

 

To Premium on Redemption A/c

 

 

 

1,00,000

 

(5,000 Debentures of Rs 100 each issued at par with the term repayable at a premium of 20%)

 

 

 

 

2016

 

 

 

 

 

Sept. 30

Interest on Debentures A/c

Dr.

 

25,000

 

 

To Debentureholders’ A/c

 

 

 

22,500

    To Income Tax Payable A/c       2,500

 

(Interest due on 10% Debentures)

 

 

 

 

 

 

 

 

 

 

Sept. 30

Debentureholders’ A/c

Dr.

 

22,500

 

 

To Bank A/c

 

 

 

22,500

 

(Interest on debentures paid to debenture holders)

 

 

 

 

           
Sept. 30 Income Tax Payable A/c Dr.   2,500  
    To Bank A/c       2,500
  (Payment of tax on interest on debentures)        
           

2017

 

 

 

 

 

March 31

Interest on Debentures A/c

Dr.

 

25,000

 

 

To Debentureholders’ A/c

 

 

 

22,500

     To Income Tax Payable A/c       2,500

 

(Interest due on 10% Debentures)

 

 

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

22,500

 

 

To Bank A/c

 

 

 

22,500

 

(Debenture Interest paid to Debenture holders)

 

 

 

 

           
March 31 Income Tax Payable A/c Dr.   2,500  
    To Bank A/c       2,500
  (Payment of tax on interest on debentures)        
           

March 31

Statement of P&L

Dr.

 

50,000

 

 

To Interest on Debentures A/c

 

 

 

50,000

 

(Interest on debentures transferred to Profit and Loss Account)

 

 

 

 

 

 

 

 

 

 

Working Note:

Interest on Debentures (for half year) = 5,00,000 × 10100 × 612 = Rs 25,000



Page No 7.52:

Question 37:

Books of XYZ Ltd.

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

2016

 

 

 

 

April 01

Bank A/c

Dr.

 

5,00,000

 

 

To Debenture Application A/c

 

 

 

5,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

 

April 01

Debenture Application A/c

Dr.

 

5,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

To 10% Debentures A/c

 

 

 

5,00,000

 

To Premium on Redemption A/c

 

 

 

1,00,000

 

(5,000 Debentures of Rs 100 each issued at par with the term repayable at a premium of 20%)

 

 

 

 

2016

 

 

 

 

 

Sept. 30

Interest on Debentures A/c

Dr.

 

25,000

 

 

To Debentureholders’ A/c

 

 

 

22,500

    To Income Tax Payable A/c       2,500

 

(Interest due on 10% Debentures)

 

 

 

 

 

 

 

 

 

 

Sept. 30

Debentureholders’ A/c

Dr.

 

22,500

 

 

To Bank A/c

 

 

 

22,500

 

(Interest on debentures paid to debenture holders)

 

 

 

 

           
Sept. 30 Income Tax Payable A/c Dr.   2,500  
    To Bank A/c       2,500
  (Payment of tax on interest on debentures)        
           

2017

 

 

 

 

 

March 31

Interest on Debentures A/c

Dr.

 

25,000

 

 

To Debentureholders’ A/c

 

 

 

22,500

     To Income Tax Payable A/c       2,500

 

(Interest due on 10% Debentures)

 

 

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

22,500

 

 

To Bank A/c

 

 

 

22,500

 

(Debenture Interest paid to Debenture holders)

 

 

 

 

           
March 31 Income Tax Payable A/c Dr.   2,500  
    To Bank A/c       2,500
  (Payment of tax on interest on debentures)        
           

March 31

Statement of P&L

Dr.

 

50,000

 

 

To Interest on Debentures A/c

 

 

 

50,000

 

(Interest on debentures transferred to Profit and Loss Account)

 

 

 

 

 

 

 

 

 

 

Working Note:

Interest on Debentures (for half year) = 5,00,000 × 10100 × 612 = Rs 25,000

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2016

 

 

 

 

 

Apr.01

Bank A/c (15,000×90)

Dr.

 

13,50,000

 

 

  To Debenture Application and Allotment A/c

 

 

 

13,50,000

 

(Received application money on Debenture)

 

 

 

 

 

 

 

 

 

 

Apr.01

Debenture Application and Allotment A/c

Dr.

 

13,50,000

 

 

Discount on Issue of Debenture A/c (10,000×10)

Dr.

 

1,00,000

 

 

Loss on Issue of Debenture A/c (10,000×10)

Dr.

 

1,00,000

 

 

  To 10% Debentures  A/c (10,000×100)

 

 

 

10,00,000

 

  To Premium on redemption of Debentures A/c (10,000×10)

 

 

 

1,00,000

 

  To Bank A/c (5,000×90)

 

 

 

4,50,000

 

(Application money transferred to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debentures Interest A/c

Dr.

 

50,000

 

 

  To  Debenture Holders’ A/c

 

 

 

45,000

 

  To TDS Payable A/c

 

 

 

5,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debenture Holders’ A/c

Dr.

 

45,000

 

 

 TDS Payable A/c

Dr.

 

5,000

 

 

    To Bank A/c

 

 

 

50,000

 

(Interest paid)

 

 

 

 

 

 

 

 

 

 

2017

 

 

 

 

 

Mar.31

Debentures Interest A/c

Dr.

 

50,000

 

 

  To  Debenture Holders’ A/c

 

 

 

45,000

 

  To TDS Payable A/c

 

 

 

5,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

Mar.31

Debenture Holders’ A/c                                          

Dr.

 

45,000

 

 

 TDS Payable A/c                                                                                     

Dr.

 

5,000

 

 

    To Bank A/c

 

 

50,000

 

(Interest paid)

 

 

 

 

 

 

 

 

Mar.31

Statement of P&L A/c                                                                                   

Dr.

 

1,00,000

 

 

    To Debentures interest A/c

 

 

1,00,000

 

(Interest transferred to P&L)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10% Debentures Account

Dr.

 

Cr.

Date

Particulars

J.F.

Amount

(Rs)

Date

Particulars

J.F.

Amount

(Rs)

2017

 

 

 

2016

 

 

 

Mar.31

Balance c/d

 

10,00,000

Apr.01

Bank A/c

 

9,00,000

 

 

 

 

 

Discount on issue of Debentures A/c

 

1,00,000

 

 

 

 

 

 

 

 

 

 

 

10,00,000

 

 

 

10,00,000

 

 

 

 

 

 

 

 

 

Page No 7.52:

Question 38:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2016

 

 

 

 

 

Apr.01

Bank A/c (15,000×90)

Dr.

 

13,50,000

 

 

  To Debenture Application and Allotment A/c

 

 

 

13,50,000

 

(Received application money on Debenture)

 

 

 

 

 

 

 

 

 

 

Apr.01

Debenture Application and Allotment A/c

Dr.

 

13,50,000

 

 

Discount on Issue of Debenture A/c (10,000×10)

Dr.

 

1,00,000

 

 

Loss on Issue of Debenture A/c (10,000×10)

Dr.

 

1,00,000

 

 

  To 10% Debentures  A/c (10,000×100)

 

 

 

10,00,000

 

  To Premium on redemption of Debentures A/c (10,000×10)

 

 

 

1,00,000

 

  To Bank A/c (5,000×90)

 

 

 

4,50,000

 

(Application money transferred to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debentures Interest A/c

Dr.

 

50,000

 

 

  To  Debenture Holders’ A/c

 

 

 

45,000

 

  To TDS Payable A/c

 

 

 

5,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debenture Holders’ A/c

Dr.

 

45,000

 

 

 TDS Payable A/c

Dr.

 

5,000

 

 

    To Bank A/c

 

 

 

50,000

 

(Interest paid)

 

 

 

 

 

 

 

 

 

 

2017

 

 

 

 

 

Mar.31

Debentures Interest A/c

Dr.

 

50,000

 

 

  To  Debenture Holders’ A/c

 

 

 

45,000

 

  To TDS Payable A/c

 

 

 

5,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

Mar.31

Debenture Holders’ A/c                                          

Dr.

 

45,000

 

 

 TDS Payable A/c                                                                                     

Dr.

 

5,000

 

 

    To Bank A/c

 

 

50,000

 

(Interest paid)

 

 

 

 

 

 

 

 

Mar.31

Statement of P&L A/c                                                                                   

Dr.

 

1,00,000

 

 

    To Debentures interest A/c

 

 

1,00,000

 

(Interest transferred to P&L)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10% Debentures Account

Dr.

 

Cr.

Date

Particulars

J.F.

Amount

(Rs)

Date

Particulars

J.F.

Amount

(Rs)

2017

 

 

 

2016

 

 

 

Mar.31

Balance c/d

 

10,00,000

Apr.01

Bank A/c

 

9,00,000

 

 

 

 

 

Discount on issue of Debentures A/c

 

1,00,000

 

 

 

 

 

 

 

 

 

 

 

10,00,000

 

 

 

10,00,000

 

 

 

 

 

 

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2016

 

 

 

 

 

Apr.01

Bank A/c (20,000×110)

Dr.

 

22,00,000

 

 

  To Debenture Application and Allotment A/c

 

 

 

22,00,000

 

(Received application money on  Debenture)

 

 

 

 

 

 

 

 

 

 

Apr.01

Debenture Application and Allotment A/c

Dr.

 

22,00,000

 

 

Loss on Issue of Debenture A/c (15,000×5)

Dr.

 

75,000

 

 

  To 10% Debentures  A/c (15,000×100)

 

 

 

15,00,000

 

  To Security Premium Reserve A/c (15,000×10)

 

 

 

1,50,000

 

  To Premium on Redemption of Debentures A/c (15,000×5)

 

 

 

75,000

 

  To Bank A/c (5,000×110)

 

 

 

5,50,000

 

(Application money transferred to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debentures Interest A/c

Dr.

 

75,000

 

 

  To  Debenture Holders’ A/c

 

 

 

60,000

 

  To TDS Payable A/c

 

 

 

15,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debenture Holders’ A/c

Dr.

 

60,000

 

 

TDS Payable A/c

Dr.

 

15,000

 

 

  To Bank A/c

 

 

 

75,000

 

(Interest paid)

 

 

 

 

 

 

 

 

 

 

2017

 

 

 

 

 

Mar.31

Debentures Interest A/c

Dr.

 

75,000

 

 

  To  Debenture Holders’ A/c

 

 

 

60,000

 

  To TDS Payable A/c

 

 

 

15,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

Mar.31

Debenture Holders’ A/c

  Dr.

 

60,000

 

 

TDS Payable A/c                                                                 

  Dr.

 

15,000

 

 

  To Bank A/c

 

 

 

75,000

 

(Interest paid)

 

 

 

 

 

 

 

 

 

 

Mar.31

Statement of P&L A/c                                             

  Dr.

 

1,50,000

 

 

    To Debentures Interest A/c

 

 

1,50,000

 

(Interest transferred to P&L)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10% Debentures Account

Dr.

 

Cr.

Date

Particulars

J.F.

Amount

(Rs)

Date

Particulars

J.F.

Amount

(Rs)

2017

 

 

 

2016

 

 

 

Mar.31

Balance c/d

 

15,00,000

Apr.01

Bank A/c

 

15,00,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

15,00,000

 

 

 

15,00,000

 

 

 

 

 

 

 

 

 

Page No 7.52:

Question 39:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2016

 

 

 

 

 

Apr.01

Bank A/c (20,000×110)

Dr.

 

22,00,000

 

 

  To Debenture Application and Allotment A/c

 

 

 

22,00,000

 

(Received application money on  Debenture)

 

 

 

 

 

 

 

 

 

 

Apr.01

Debenture Application and Allotment A/c

Dr.

 

22,00,000

 

 

Loss on Issue of Debenture A/c (15,000×5)

Dr.

 

75,000

 

 

  To 10% Debentures  A/c (15,000×100)

 

 

 

15,00,000

 

  To Security Premium Reserve A/c (15,000×10)

 

 

 

1,50,000

 

  To Premium on Redemption of Debentures A/c (15,000×5)

 

 

 

75,000

 

  To Bank A/c (5,000×110)

 

 

 

5,50,000

 

(Application money transferred to Debentures A/c)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debentures Interest A/c

Dr.

 

75,000

 

 

  To  Debenture Holders’ A/c

 

 

 

60,000

 

  To TDS Payable A/c

 

 

 

15,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

 

Sep.30

Debenture Holders’ A/c

Dr.

 

60,000

 

 

TDS Payable A/c

Dr.

 

15,000

 

 

  To Bank A/c

 

 

 

75,000

 

(Interest paid)

 

 

 

 

 

 

 

 

 

 

2017

 

 

 

 

 

Mar.31

Debentures Interest A/c

Dr.

 

75,000

 

 

  To  Debenture Holders’ A/c

 

 

 

60,000

 

  To TDS Payable A/c

 

 

 

15,000

 

(Interest due)

 

 

 

 

 

 

 

 

 

Mar.31

Debenture Holders’ A/c

  Dr.

 

60,000

 

 

TDS Payable A/c                                                                 

  Dr.

 

15,000

 

 

  To Bank A/c

 

 

 

75,000

 

(Interest paid)

 

 

 

 

 

 

 

 

 

 

Mar.31

Statement of P&L A/c                                             

  Dr.

 

1,50,000

 

 

    To Debentures Interest A/c

 

 

1,50,000

 

(Interest transferred to P&L)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10% Debentures Account

Dr.

 

Cr.

Date

Particulars

J.F.

Amount

(Rs)

Date

Particulars

J.F.

Amount

(Rs)

2017

 

 

 

2016

 

 

 

Mar.31

Balance c/d

 

15,00,000

Apr.01

Bank A/c

 

15,00,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

15,00,000

 

 

 

15,00,000

 

 

 

 

 

 

 

 

 

Answer:

According to Section 52 of Companies Act, 2013, securities premium amount can be utilised for writing-off discount on issue of debentures. Thus, discount on issue of debentures will be written-off from the balance of Securities Premium Reserve Account. The Journal entry will be as follows:
 

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Securities Premium A/c Dr.   10,000  
 
To Discount on Issue of Debentures A/c
      10,000
  (Discount on issue of debentures written-off from securities premium)      
           

Page No 7.52:

Question 40:

According to Section 52 of Companies Act, 2013, securities premium amount can be utilised for writing-off discount on issue of debentures. Thus, discount on issue of debentures will be written-off from the balance of Securities Premium Reserve Account. The Journal entry will be as follows:
 

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  Securities Premium A/c Dr.   10,000  
 
To Discount on Issue of Debentures A/c
      10,000
  (Discount on issue of debentures written-off from securities premium)      
           

Answer:

 

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
2016          
April 01 Bank A/c Dr.   94,000  
 
To Debenture Application and Allotment A/c
      94,000
  (Applications received for Rs 1,00,000, 9% debentures at 6% discount)      
           
  Debenture Application and Allotment A/c Dr.   94,000  
  Loss on Issue of Debentures A/c Dr.   6,000  
 
To 8% Debentures A/c
      1,00,000
  (Debentures issued at discount and redeemable at par)      
           
  Statement of Profit and Loss Dr.   6,000  
 
To Loss on Issue of Debentures A/c
      6,000
  (Loss on issue of debentures written off)        
           

Working Note:
Discount on Issue of Debentures =

Page No 7.52:

Question 41:

 

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
2016          
April 01 Bank A/c Dr.   94,000  
 
To Debenture Application and Allotment A/c
      94,000
  (Applications received for Rs 1,00,000, 9% debentures at 6% discount)      
           
  Debenture Application and Allotment A/c Dr.   94,000  
  Loss on Issue of Debentures A/c Dr.   6,000  
 
To 8% Debentures A/c
      1,00,000
  (Debentures issued at discount and redeemable at par)      
           
  Statement of Profit and Loss Dr.   6,000  
 
To Loss on Issue of Debentures A/c
      6,000
  (Loss on issue of debentures written off)        
           

Working Note:
Discount on Issue of Debentures =

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
2016          
Jan. 01 Bank A/c Dr.   6,00,000  
 
To Debenture Application and Allotment A/c
      6,00,000
  (Applications received for Rs 6,00,000, 8% debentures)      
           
  Debenture Application and Allotment A/c Dr.   6,00,000  
  Loss on Issue of Debentures A/c Dr.   30,000  
 
To 8% Debentures A/c
      6,00,000
 
To Premium on Redemption of Debentures A/c
      30,000
  (Debentures issued at par and redeemable at premium)      
           
  Securities Premium Reserve A/c Dr.   10,000  
  Statement of Profit and Loss Dr.   20,000  
 
To Loss on Issue of Debentures A/c
      30,000
  (Loss on issue of debentures written off)        
           

Page No 7.52:

Question 42:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
2016          
Jan. 01 Bank A/c Dr.   6,00,000  
 
To Debenture Application and Allotment A/c
      6,00,000
  (Applications received for Rs 6,00,000, 8% debentures)      
           
  Debenture Application and Allotment A/c Dr.   6,00,000  
  Loss on Issue of Debentures A/c Dr.   30,000  
 
To 8% Debentures A/c
      6,00,000
 
To Premium on Redemption of Debentures A/c
      30,000
  (Debentures issued at par and redeemable at premium)      
           
  Securities Premium Reserve A/c Dr.   10,000  
  Statement of Profit and Loss Dr.   20,000  
 
To Loss on Issue of Debentures A/c
      30,000
  (Loss on issue of debentures written off)        
           

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

Security Premium Reserve A/c

Dr.

 

15,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

15,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Note: The above entry will be passed for every year for 5 years.

Loss on issue of Debentures=5,00,000×15%=Rs 75,000Amount of loss on issue of Debentures to be written off every year=75,0005=Rs 15,000 every year

Page No 7.52:

Question 43:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

Security Premium Reserve A/c

Dr.

 

15,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

15,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Note: The above entry will be passed for every year for 5 years.

Loss on issue of Debentures=5,00,000×15%=Rs 75,000Amount of loss on issue of Debentures to be written off every year=75,0005=Rs 15,000 every year

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

Year 1

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 2

Security Premium Reserve A/c

Dr.

 

20,000

 

 

Statement of Profit & Loss A/c

Dr.

 

10,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 3

Statement of Profit & Loss A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Note: Last entry will be passed for next two remaining years.

Loss on Issue of Debentures=Discount on Issue of Debentures+Premium on Redemption of Debentures=10,00,000×5%+10,00,000×10%=Rs 1,50,000Amount of Loss on Issue of Debentures to be written off every year=1,50,0005=Rs 30,000 every year



Page No 7.53:

Question 44:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

Year 1

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 2

Security Premium Reserve A/c

Dr.

 

20,000

 

 

Statement of Profit & Loss A/c

Dr.

 

10,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 3

Statement of Profit & Loss A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Note: Last entry will be passed for next two remaining years.

Loss on Issue of Debentures=Discount on Issue of Debentures+Premium on Redemption of Debentures=10,00,000×5%+10,00,000×10%=Rs 1,50,000Amount of Loss on Issue of Debentures to be written off every year=1,50,0005=Rs 30,000 every year

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (10,000 × 100)

Dr.

 

10,00,000

 

 

  To Debenture Application & Allotment A/c

 

 

 

10,00,000

 

(Received application money on 10,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application & Allotment A/c

Dr.

 

10,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

  To 9% Debentures A/c (10,000 × 100)

 

 

 

10,00,000

 

  To Premium on Redemption of Debentures A/c

 

 

 

1,00,000

 

(10,000, 9% Debentures of Rs 100 each issued at par and redeemable at premium of 10%)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit & Loss A/c

Dr.

 

20,000

 

 

    To  Loss on Issue of Debentures A/c

 

 

 

20,000

 

( Loss on issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Working Notes:
Amount of Loss on Issue of Debentures to be Written Off Every Year=1,00,0005=20,000

Note: Last entry would be repeated every year for coming 4 years.

Page No 7.53:

Question 45:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

Bank A/c (10,000 × 100)

Dr.

 

10,00,000

 

 

  To Debenture Application & Allotment A/c

 

 

 

10,00,000

 

(Received application money on 10,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application & Allotment A/c

Dr.

 

10,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

  To 9% Debentures A/c (10,000 × 100)

 

 

 

10,00,000

 

  To Premium on Redemption of Debentures A/c

 

 

 

1,00,000

 

(10,000, 9% Debentures of Rs 100 each issued at par and redeemable at premium of 10%)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit & Loss A/c

Dr.

 

20,000

 

 

    To  Loss on Issue of Debentures A/c

 

 

 

20,000

 

( Loss on issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Working Notes:
Amount of Loss on Issue of Debentures to be Written Off Every Year=1,00,0005=20,000

Note: Last entry would be repeated every year for coming 4 years.

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

Statement of Profit & Loss A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Note: This entry will be passed for next two years.

Loss on issue of Debentures=10,000×9=Rs 90,000Amount of loss on issue of Debentures to be written off every year=90,0003=Rs 30,000 every year

Loss on Issue of Debentures Account

Dr.

Cr.

Date

Particulars

Amount

(Rs)

Date

Particulars

Amount

(Rs)

 

 

 

 

 

 

Year 1

8% Debentures A/c

90,000

Year 1

Statement of Profit & Loss A/c

30,000

 

 

 

 

Balance c/d

60,000

 

 

90,000

 

 

90,000

Year 2

Balance b/d

  60,000

Year 2

Statement of Profit & Loss A/c

30,000

 

 

 

 

Balance c/d

30,000

 

 

60,000

 

 

60,000

Year 3

Balance b/d

  30,000

Year 3

Statement of Profit & Loss A/c

30,000

 

 

 

 

 

 

 

 

30,000

 

 

30,000

 

 

 

 

 

 

 

Page No 7.53:

Question 46:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

Statement of Profit & Loss A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Note: This entry will be passed for next two years.

Loss on issue of Debentures=10,000×9=Rs 90,000Amount of loss on issue of Debentures to be written off every year=90,0003=Rs 30,000 every year

Loss on Issue of Debentures Account

Dr.

Cr.

Date

Particulars

Amount

(Rs)

Date

Particulars

Amount

(Rs)

 

 

 

 

 

 

Year 1

8% Debentures A/c

90,000

Year 1

Statement of Profit & Loss A/c

30,000

 

 

 

 

Balance c/d

60,000

 

 

90,000

 

 

90,000

Year 2

Balance b/d

  60,000

Year 2

Statement of Profit & Loss A/c

30,000

 

 

 

 

Balance c/d

30,000

 

 

60,000

 

 

60,000

Year 3

Balance b/d

  30,000

Year 3

Statement of Profit & Loss A/c

30,000

 

 

 

 

 

 

 

 

30,000

 

 

30,000

 

 

 

 

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

Year 1

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 2

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 3

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 4

Security Premium Reserve A/c

Dr.

 

10,000

 

 

Statement of Profit & Loss A/c

Dr.

 

20,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 5

Statement of Profit & Loss A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Loss on Issue of Debentures Account

Dr.

Cr.

Date

Particulars

Amount

(Rs)

Date

Particulars

Amount

(Rs)

 

 

 

 

 

 

Year 1

7% Debentures A/c

1,50,000

Year 1

Security Premium Reserve A/c

30,000

 

 

 

 

Balance c/d

1,20,000

 

 

1,50,000

 

 

1,50,000

Year 2

Balance b/d

1,20,000

Year 2

Security Premium Reserve A/c

30,000

 

 

 

 

Balance c/d

90,000

 

 

1,20,000

 

 

1,20,000

Year 3

Balance b/d

  90,000

Year 3

Security Premium Reserve A/c

30,000

 

 

 

 

Balance c/d

60,000

 

 

  90,000

 

 

  90,000

Year 4

Balance b/d

60,000

Year 4

Security Premium Reserve A/c

10,000

 

 

 

 

Statement of Profit & Loss A/c

20,000

 

 

 

 

Balance c/d

 

30,000

 

 

60,000

 

 

60,000

Year 5

Balance b/d

30,000

Year 5

Statement of Profit & Loss A/c

30,000

 

 

 

 

 

 

 

 

30,000

 

 

30,000

 

 

 

 

 

 

             

Working Note:

Loss on issue of Debentures=10,00,000×15%=Rs 1,50,000Amount of loss on issue of Debentures to be written off every year=1,50,0005=Rs 30,000 every year

Page No 7.53:

Question 47:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

Year 1

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 2

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 3

Security Premium Reserve A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 4

Security Premium Reserve A/c

Dr.

 

10,000

 

 

Statement of Profit & Loss A/c

Dr.

 

20,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Year 5

Statement of Profit & Loss A/c

Dr.

 

30,000

 

 

     To Loss on Issue of Debentures A/c

 

 

 

30,000

 

(Loss on Issue of Debentures written off)

 

 

 

 

 

 

 

 

 

 

Loss on Issue of Debentures Account

Dr.

Cr.

Date

Particulars

Amount

(Rs)

Date

Particulars

Amount

(Rs)

 

 

 

 

 

 

Year 1

7% Debentures A/c

1,50,000

Year 1

Security Premium Reserve A/c

30,000

 

 

 

 

Balance c/d

1,20,000

 

 

1,50,000

 

 

1,50,000

Year 2

Balance b/d

1,20,000

Year 2

Security Premium Reserve A/c

30,000

 

 

 

 

Balance c/d

90,000

 

 

1,20,000

 

 

1,20,000

Year 3

Balance b/d

  90,000

Year 3

Security Premium Reserve A/c

30,000

 

 

 

 

Balance c/d

60,000

 

 

  90,000

 

 

  90,000

Year 4

Balance b/d

60,000

Year 4

Security Premium Reserve A/c

10,000

 

 

 

 

Statement of Profit & Loss A/c

20,000

 

 

 

 

Balance c/d

 

30,000

 

 

60,000

 

 

60,000

Year 5

Balance b/d

30,000

Year 5

Statement of Profit & Loss A/c

30,000

 

 

 

 

 

 

 

 

30,000

 

 

30,000

 

 

 

 

 

 

             

Working Note:

Loss on issue of Debentures=10,00,000×15%=Rs 1,50,000Amount of loss on issue of Debentures to be written off every year=1,50,0005=Rs 30,000 every year

Answer:

Balance Sheet
as at March 31, 2017
Particulars
Note No.
Amount 
(Rs)
 
 
 
II Assets
 
 
1. Non-Current Assets
 
 
a. Other Non-Current Assets
1
96,000
2. Current Assets
 
 
a. Other Current Assets
2
32,000
Total
 
1,28,000
 
 
 

 

NOTES TO ACCOUNTS

Note No.
Particulars
Amount 
(Rs)
1.
Other Non-Current Assets
 
 
Loss on issue of Debentures  
1,28,000
 
 
    Less: Shown as Other Current Assets
32,000
96,000
 
(To the extent to be written off after 12 months from the date of Balance sheet)
 
2.
Other Current Assets
 
 
Loss on issue of Debentures                                                     
32,000
 
(To the extent to be written off within 12 months from the date of Balance sheet)
 
 
 
 

Page No 7.53:

Question 48:

Balance Sheet
as at March 31, 2017
Particulars
Note No.
Amount 
(Rs)
 
 
 
II Assets
 
 
1. Non-Current Assets
 
 
a. Other Non-Current Assets
1
96,000
2. Current Assets
 
 
a. Other Current Assets
2
32,000
Total
 
1,28,000
 
 
 

 

NOTES TO ACCOUNTS

Note No.
Particulars
Amount 
(Rs)
1.
Other Non-Current Assets
 
 
Loss on issue of Debentures  
1,28,000
 
 
    Less: Shown as Other Current Assets
32,000
96,000
 
(To the extent to be written off after 12 months from the date of Balance sheet)
 
2.
Other Current Assets
 
 
Loss on issue of Debentures                                                     
32,000
 
(To the extent to be written off within 12 months from the date of Balance sheet)
 
 
 
 

Answer:

Balance Sheet

as at March 31, 2016

 

Particulars

Note No.

Amount 

(Rs)

 

 

 

 

 

II Assets

 

 

 

1. Non-Current Assets

 

 

 

a. Other Non-Current Assets

 

1,20,000

 

2. Current Assets

 

 

 

a. Other Current Assets

 

40,000

 

Total

 

1,60,000

 

 

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures   

1,60,000

 

 

  Less: Shown as Other Current Assets

40,000

1,20,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

             

 

Balance Sheet

as at March 31, 2017

 

Particulars

Note No.

Amount 

(Rs)

 

 

 

 

 

II Assets

 

 

 

1. Non-Current Assets

 

 

 

a. Other Non-Current Assets

 

80,000

 

2. Current Assets

 

 

 

a. Other Current Assets

 

40,000

 

Total

 

1,20,000

 

 

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures                                                 

1,20,000

 

 

  Less: Shown as Other Current Assets

40,000

80,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

3

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Page No 7.53:

Question 49:

Balance Sheet

as at March 31, 2016

 

Particulars

Note No.

Amount 

(Rs)

 

 

 

 

 

II Assets

 

 

 

1. Non-Current Assets

 

 

 

a. Other Non-Current Assets

 

1,20,000

 

2. Current Assets

 

 

 

a. Other Current Assets

 

40,000

 

Total

 

1,60,000

 

 

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures   

1,60,000

 

 

  Less: Shown as Other Current Assets

40,000

1,20,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

             

 

Balance Sheet

as at March 31, 2017

 

Particulars

Note No.

Amount 

(Rs)

 

 

 

 

 

II Assets

 

 

 

1. Non-Current Assets

 

 

 

a. Other Non-Current Assets

 

80,000

 

2. Current Assets

 

 

 

a. Other Current Assets

 

40,000

 

Total

 

1,20,000

 

 

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures                                                 

1,20,000

 

 

  Less: Shown as Other Current Assets

40,000

80,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

3

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Answer:

Balance Sheet

as at March 31, 2016

Particulars

Note No.

Amount 

(Rs)

II Assets

 

 

1. Non-Current Assets

 

 

  1. Other Non-Current Assets

 

1,20,000

2. Current Assets

 

 

  1. Other Current Assets

 

40,000

Total

 

 

 

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures                                                  

1,60,000

 

 

   Less: Shown as Other Current Assets

40,000

1,20,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                      

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Balance Sheet

as at March 31, 2017
 

Particulars

Note No.

Amount 

(Rs)

II Assets

 

 

1. Non-Current Assets

 

 

  1. Other Non-Current Assets

 

80,000

2. Current Assets

 

 

  1. Other Current Assets

 

40,000

Total

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-Current Assets

 

 

Loss on issue of Debentures                                                         1,20,000

 

 

  Less: Shown as Other Current Assets

40,000

80,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

Page No 7.53:

Question 50:

Balance Sheet

as at March 31, 2016

Particulars

Note No.

Amount 

(Rs)

II Assets

 

 

1. Non-Current Assets

 

 

  1. Other Non-Current Assets

 

1,20,000

2. Current Assets

 

 

  1. Other Current Assets

 

40,000

Total

 

 

 

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures                                                  

1,60,000

 

 

   Less: Shown as Other Current Assets

40,000

1,20,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                      

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Balance Sheet

as at March 31, 2017
 

Particulars

Note No.

Amount 

(Rs)

II Assets

 

 

1. Non-Current Assets

 

 

  1. Other Non-Current Assets

 

80,000

2. Current Assets

 

 

  1. Other Current Assets

 

40,000

Total

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-Current Assets

 

 

Loss on issue of Debentures                                                         1,20,000

 

 

  Less: Shown as Other Current Assets

40,000

80,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

Answer:

Balance Sheet

as at March 31, 2016

Particulars

Note No.

Amount 

(Rs)

I. Liabilities

 

 

   1. Reserves & Surplus

 

 

       a. Securities Premium Reserve

 

60,000

 

 

 

II Assets

 

 

1. Non-Current Assets

 

 

         a. Other Non-Current Assets

 

1,20,000

2. Current Assets

 

 

         a. Other Current Assets

 

40,000

Total

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures                                                 

1,60,000

 

 

  Less: Shown as Other Current Assets

40,000

1,20,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Balance Sheet

as at March 31, 2017

Particulars

Note No.

Amount 

(Rs)

I Liabilities    
    1. Reserves & Surplus    
         a. Statement of P&L   (20,000)

II Assets

 

 

1. Non-Current Assets

 

 

          a. Other Non-Current Assets

 

80,000

2. Current Assets

 

 

          b. Other Current Assets

 

20,000

Total

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1. Reserves and Surplus  
   Statement of P&L (20,000)
     

2.

Other Non-current Assets

 

 

Loss on issue of Debentures     

1,20,000

 

 

  Less: Shown as Other Current Assets

40,000

80,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

3.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Page No 7.53:

Question 51:

Balance Sheet

as at March 31, 2016

Particulars

Note No.

Amount 

(Rs)

I. Liabilities

 

 

   1. Reserves & Surplus

 

 

       a. Securities Premium Reserve

 

60,000

 

 

 

II Assets

 

 

1. Non-Current Assets

 

 

         a. Other Non-Current Assets

 

1,20,000

2. Current Assets

 

 

         a. Other Current Assets

 

40,000

Total

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1.

Other Non-current Assets

 

 

Loss on issue of Debentures                                                 

1,60,000

 

 

  Less: Shown as Other Current Assets

40,000

1,20,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

2.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Balance Sheet

as at March 31, 2017

Particulars

Note No.

Amount 

(Rs)

I Liabilities    
    1. Reserves & Surplus    
         a. Statement of P&L   (20,000)

II Assets

 

 

1. Non-Current Assets

 

 

          a. Other Non-Current Assets

 

80,000

2. Current Assets

 

 

          b. Other Current Assets

 

20,000

Total

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1. Reserves and Surplus  
   Statement of P&L (20,000)
     

2.

Other Non-current Assets

 

 

Loss on issue of Debentures     

1,20,000

 

 

  Less: Shown as Other Current Assets

40,000

80,000

 

(To the extent to be written off after 12 months from the date of Balance sheet )

 

3.

Other Current Assets

 

 

Loss on issue of Debentures                                                     

40,000

 

(To the extent to be written off within 12 months from the date of Balance sheet )

 

 

 

 

 

Answer:

In the Books of Eay Kay Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

Beginning

 

 

 

 

 

of the year

Bank A/c

Dr.

 

6,25,000

 

 

     To Debenture Application

 

 

 

6,25,000

 

(Application money received for 12,500, 10% Debentures @ Rs 50)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

6,25,000

 

 

    To 10% Debentures A/c

 

 

 

5,00,000

 

    To Debenture Allotment A/c

 

 

 

1,25,000

 

(Amount transferred to 10% Debentures Account)

 

 

 

 

 

 

 

 

 

 

 

Debenture Allotment A/c (40 × 10,000)

Dr.

 

4,00,000

 

 

Loss on Issue of Debentures A/c (1,00,000 + 50,000)

Dr.

 

1,50,000

 

 

    To 10% Debentures A/c (50 × 10,000)

 

 

 

5,00,000

 

    To Premium on Redemption of Debentures A/c (5 × 10,000)

 

 

 

50,000

 

(Allotment money due on 10,000 Debentures issued at Rs 90 and redeemable at Rs 105)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (4,00,000 – 1,25,000)

Dr.

 

2,75,000

 

 

   To Debenture Allotment A/c (4,00,000 – 1,25,000)

 

 

 

2,75,000

 

(Allotment money received)

 

 

 

 

 

 

 

 

 

 

 

Plant and Machinery A/c

Dr.

 

11,00,000

 

 

   To Vendor’s A/c

 

 

 

11,00,000

 

(Plant and Machinery purchased)

 

 

 

 

 

 

 

 

 

 

 

Vendor’s A/c

Dr.

 

11,00,000

 

 

   To 10% Debentures A/c

 

 

 

10,00,000

 

   To Securities Premium Reserve A/c

 

 

 

1,00,000

 

(Debentures issued to vendor @ Rs 110 each)

 

 

 

 

 

 

 

 

 

 

Year End

Securities Premium Reserve A/c

Dr.

 

1,00,000

 

 

Surplus, i.e. Balance in Statement of Profit and Loss

 

 

50,000

 

 

    To Loss on Issue of Debentures A/c

 

 

 

1,50,000

 

(Loss on issue of debentures written off)

 

 

 

 

 

 

 

 

 

 

Number of Debentures issued to Vendor=11,00,000110=10,000 Debentures

Extract of Balance Sheet

Particulars

Note No.

Figures at the end of reporting period

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

 Reserves and Surplus

1

(50,000)

2. Non-Current Liabilities

 

 

      Long-term Borrowings

2

20,50,000

 

 

 

Total

 

20,00,000

 

 

 

II Assets

 

 

1. Non-Current Assets

 

 

               Fixed Assets-Machinery

3

11,00,000

2. Current Assets

 

 

Cash and Cash Equivalents

4

 

Total

 

20,00,000

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1

Reserves and Surplus

 

 

Securities Premium Reserve

1,00,000

 

 

  Less: Loss on Issue of Debentures

(1,00,000)

 

 

Surplus, i.e. Balance in Statement of Profit and Loss

(50,000)

 

 

(50,000)

2

Long-term Borrowings

 

 

20,000; 10% Debentures

20,00,000

 

Premium on Redemption of Debentures

50,000

 

 

20,50,000

3

Non-Current Assets

 

 

Machinery

11,00,000

 

 

 

4

Cash and Cash Equivalents

 

 

Cash at Bank

9,00,000

 

 

 


Note: Entries related to Interest on Debentures have not been passed as was not required.



Page No 7.54:

Question 52:

In the Books of Eay Kay Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

Beginning

 

 

 

 

 

of the year

Bank A/c

Dr.

 

6,25,000

 

 

     To Debenture Application

 

 

 

6,25,000

 

(Application money received for 12,500, 10% Debentures @ Rs 50)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

6,25,000

 

 

    To 10% Debentures A/c

 

 

 

5,00,000

 

    To Debenture Allotment A/c

 

 

 

1,25,000

 

(Amount transferred to 10% Debentures Account)

 

 

 

 

 

 

 

 

 

 

 

Debenture Allotment A/c (40 × 10,000)

Dr.

 

4,00,000

 

 

Loss on Issue of Debentures A/c (1,00,000 + 50,000)

Dr.

 

1,50,000

 

 

    To 10% Debentures A/c (50 × 10,000)

 

 

 

5,00,000

 

    To Premium on Redemption of Debentures A/c (5 × 10,000)

 

 

 

50,000

 

(Allotment money due on 10,000 Debentures issued at Rs 90 and redeemable at Rs 105)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (4,00,000 – 1,25,000)

Dr.

 

2,75,000

 

 

   To Debenture Allotment A/c (4,00,000 – 1,25,000)

 

 

 

2,75,000

 

(Allotment money received)

 

 

 

 

 

 

 

 

 

 

 

Plant and Machinery A/c

Dr.

 

11,00,000

 

 

   To Vendor’s A/c

 

 

 

11,00,000

 

(Plant and Machinery purchased)

 

 

 

 

 

 

 

 

 

 

 

Vendor’s A/c

Dr.

 

11,00,000

 

 

   To 10% Debentures A/c

 

 

 

10,00,000

 

   To Securities Premium Reserve A/c

 

 

 

1,00,000

 

(Debentures issued to vendor @ Rs 110 each)

 

 

 

 

 

 

 

 

 

 

Year End

Securities Premium Reserve A/c

Dr.

 

1,00,000

 

 

Surplus, i.e. Balance in Statement of Profit and Loss

 

 

50,000

 

 

    To Loss on Issue of Debentures A/c

 

 

 

1,50,000

 

(Loss on issue of debentures written off)

 

 

 

 

 

 

 

 

 

 

Number of Debentures issued to Vendor=11,00,000110=10,000 Debentures

Extract of Balance Sheet

Particulars

Note No.

Figures at the end of reporting period

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

 Reserves and Surplus

1

(50,000)

2. Non-Current Liabilities

 

 

      Long-term Borrowings

2

20,50,000

 

 

 

Total

 

20,00,000

 

 

 

II Assets

 

 

1. Non-Current Assets

 

 

               Fixed Assets-Machinery

3

11,00,000

2. Current Assets

 

 

Cash and Cash Equivalents

4

 

Total

 

20,00,000

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1

Reserves and Surplus

 

 

Securities Premium Reserve

1,00,000

 

 

  Less: Loss on Issue of Debentures

(1,00,000)

 

 

Surplus, i.e. Balance in Statement of Profit and Loss

(50,000)

 

 

(50,000)

2

Long-term Borrowings

 

 

20,000; 10% Debentures

20,00,000

 

Premium on Redemption of Debentures

50,000

 

 

20,50,000

3

Non-Current Assets

 

 

Machinery

11,00,000

 

 

 

4

Cash and Cash Equivalents

 

 

Cash at Bank

9,00,000

 

 

 


Note: Entries related to Interest on Debentures have not been passed as was not required.

Answer:

 

In the Books of Gee Ess Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2014

 

 

 

 

 

April 01

Computers A/c

Dr.

 

7,50,000

 

 

Office Furniture A/c

Dr.

 

2,50,000

 

 

   To Vendor’s A/c

 

 

 

10,00,000

 

(Computer and Office Furniture purchased)

 

 

 

 

 

 

 

 

 

 

 

Vendor’s A/c

Dr.

 

10,00,000

 

 

Discount on Issue of Debentures A/c

Dr.

 

1,11,110

 

 

   To 10% Debentures A/c

 

 

 

11,11,100

 

   To Bank A/c (Fraction settled through bank)

 

 

 

10

 

(Debentures issued to vendor @ Rs 90 each)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

13,75,000

 

 

     To Debenture Application & Allotment A/c

 

 

 

13,75,000

 

(Application money received for 12,500, 8% Debentures @ Rs 110)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application & Allotment A/c

Dr.

 

13,75,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

    To 8% Debentures A/c

 

 

 

10,00,000

 

    To Securities Premium Reserve A/c

 

 

 

1,00,000

 

    To Premium on Redemption of Debentures A/c

 

 

 

1,00,000

 

    To Bank A/c*

 

 

 

2,75,000

 

(10% Debentures allotted to 10,000 Debenture-holders)

 

 

 

 

 

 

 

 

 

 

Sept. 30

Deb. Interest A/c (11,11,100 × 10% × 6/12) + (10,00,000 × 8% × 6/12)

Dr.

 

95,555

 

 

    To Debentureholders’ A/c

 

 

 

95,555

 

(Interest on debentures payable at prescribed rates for six months)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

95,555

 

 

    To Bank A/c

 

 

 

95,555

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

Year End

Deb. Interest A/c (11,11,100 × 10% × 6/12) + (10,00,000 × 8% × 6/12)

Dr.

 

95,555

 

 

    To Debentureholders’ A/c

 

 

 

95,555

 

(Interest on debentures payable at prescribed rates for six months)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

95,555

 

 

    To Bank A/c

 

 

 

95,555

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

 

Securities Premium Reserve A/c

Dr.

 

1,00,000

 

 

Surplus, i.e. Balance in Statement of Profit and Loss

 

 

1,11,110

 

 

    To Loss on Issue of Debentures A/c

 

 

 

1,00,000

 

    To Discount on Issue of debentures A/c

 

 

 

1,11,110

 

(Loss on issue of debentures written off)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit and Loss (95,555 + 95,555)

Dr.

 

1,91,110

 

 

    To Debentures’ Interest A/c

 

 

 

1,91,110

 

(Transfer of Debenture Interest to Statement of P&L)

 

 

 

 

 

 

 

 

 


Number of Debentures Issued to Vendor = 10,00,00090=11,111​

 

Particulars

Note No.

Figures at the end of reporting period

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

a. Share Capital

1

15,00,000

 b. Reserves and Surplus

2

(3,02,220)

2. Non-Current Liabilities

 

 

      Long-term Borrowings

3

22,11,100

 

 

 

Total

 

34,08,880

 

 

 

II Assets

 

 

1. Non-Current Assets

 

 

         Fixed Assets- Computer and Office Furniture

3

10,00,000

2. Current Assets

 

 

Cash and Cash Equivalents

4

24,08,880

Total

 

34,08,880

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1

Share Capital

 

 

Authorised Capital

 

 

2,00,000 shares of Rs 10 each

20,00,000

 

Issued, Subscribed and Paid-up Capital

 

 

1,50,00 shares of Rs 10 each

15,00,000

 

 

 

2

Reserves and Surplus

 

 

Securities Premium Reserve

1,00,000

 

 

  Less: Loss on Issue of Debentures

 (1,00,000)

 

 

Statement of Profit and Loss (1,11,110 + 1,91,110)

(3,02,220)

 

 

(3,02,220)

2

Long-term Borrowings

 

 

11,111; 10% Debentures

11,11,100

 

10,000; 8% Debentures

10,00,000

 

Premium on Redemption of Debentures

1,00,000

 

 

22,11,100

3

Non-Current Assets

 

 

Computers

7,50,000

 

Office Furniture

2,50,000

 

 

10,00,000

 

 

 

4

Cash and Cash Equivalents

 

 

Cash at Bank (15,00,000 + 13,75,000 – 2,75,000 – 95,555, 95,555 – 10)

24,08,880

 

 

 


*It has been provided that full amount is received with application accordingly excess amount received would be refunded.

Page No 7.54:

Question 53:

 

In the Books of Gee Ess Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2014

 

 

 

 

 

April 01

Computers A/c

Dr.

 

7,50,000

 

 

Office Furniture A/c

Dr.

 

2,50,000

 

 

   To Vendor’s A/c

 

 

 

10,00,000

 

(Computer and Office Furniture purchased)

 

 

 

 

 

 

 

 

 

 

 

Vendor’s A/c

Dr.

 

10,00,000

 

 

Discount on Issue of Debentures A/c

Dr.

 

1,11,110

 

 

   To 10% Debentures A/c

 

 

 

11,11,100

 

   To Bank A/c (Fraction settled through bank)

 

 

 

10

 

(Debentures issued to vendor @ Rs 90 each)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c

Dr.

 

13,75,000

 

 

     To Debenture Application & Allotment A/c

 

 

 

13,75,000

 

(Application money received for 12,500, 8% Debentures @ Rs 110)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application & Allotment A/c

Dr.

 

13,75,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

    To 8% Debentures A/c

 

 

 

10,00,000

 

    To Securities Premium Reserve A/c

 

 

 

1,00,000

 

    To Premium on Redemption of Debentures A/c

 

 

 

1,00,000

 

    To Bank A/c*

 

 

 

2,75,000

 

(10% Debentures allotted to 10,000 Debenture-holders)

 

 

 

 

 

 

 

 

 

 

Sept. 30

Deb. Interest A/c (11,11,100 × 10% × 6/12) + (10,00,000 × 8% × 6/12)

Dr.

 

95,555

 

 

    To Debentureholders’ A/c

 

 

 

95,555

 

(Interest on debentures payable at prescribed rates for six months)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

95,555

 

 

    To Bank A/c

 

 

 

95,555

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

Year End

Deb. Interest A/c (11,11,100 × 10% × 6/12) + (10,00,000 × 8% × 6/12)

Dr.

 

95,555

 

 

    To Debentureholders’ A/c

 

 

 

95,555

 

(Interest on debentures payable at prescribed rates for six months)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

95,555

 

 

    To Bank A/c

 

 

 

95,555

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

 

Securities Premium Reserve A/c

Dr.

 

1,00,000

 

 

Surplus, i.e. Balance in Statement of Profit and Loss

 

 

1,11,110

 

 

    To Loss on Issue of Debentures A/c

 

 

 

1,00,000

 

    To Discount on Issue of debentures A/c

 

 

 

1,11,110

 

(Loss on issue of debentures written off)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit and Loss (95,555 + 95,555)

Dr.

 

1,91,110

 

 

    To Debentures’ Interest A/c

 

 

 

1,91,110

 

(Transfer of Debenture Interest to Statement of P&L)

 

 

 

 

 

 

 

 

 


Number of Debentures Issued to Vendor = 10,00,00090=11,111​

 

Particulars

Note No.

Figures at the end of reporting period

I. Equity and Liabilities

 

 

1. Shareholders’ Funds

 

 

a. Share Capital

1

15,00,000

 b. Reserves and Surplus

2

(3,02,220)

2. Non-Current Liabilities

 

 

      Long-term Borrowings

3

22,11,100

 

 

 

Total

 

34,08,880

 

 

 

II Assets

 

 

1. Non-Current Assets

 

 

         Fixed Assets- Computer and Office Furniture

3

10,00,000

2. Current Assets

 

 

Cash and Cash Equivalents

4

24,08,880

Total

 

34,08,880

 

 

 

 

NOTES TO ACCOUNTS

Note No.

Particulars

Amount 

(Rs)

1

Share Capital

 

 

Authorised Capital

 

 

2,00,000 shares of Rs 10 each

20,00,000

 

Issued, Subscribed and Paid-up Capital

 

 

1,50,00 shares of Rs 10 each

15,00,000

 

 

 

2

Reserves and Surplus

 

 

Securities Premium Reserve

1,00,000

 

 

  Less: Loss on Issue of Debentures

 (1,00,000)

 

 

Statement of Profit and Loss (1,11,110 + 1,91,110)

(3,02,220)

 

 

(3,02,220)

2

Long-term Borrowings

 

 

11,111; 10% Debentures

11,11,100

 

10,000; 8% Debentures

10,00,000

 

Premium on Redemption of Debentures

1,00,000

 

 

22,11,100

3

Non-Current Assets

 

 

Computers

7,50,000

 

Office Furniture

2,50,000

 

 

10,00,000

 

 

 

4

Cash and Cash Equivalents

 

 

Cash at Bank (15,00,000 + 13,75,000 – 2,75,000 – 95,555, 95,555 – 10)

24,08,880

 

 

 


*It has been provided that full amount is received with application accordingly excess amount received would be refunded.

Answer:

 

Books of The Earth Ltd.

 

Journal

Date

Particulars

L.F.

Debit Amount

Rs

Credit Amount

Rs

2016

 

 

 

 

 

April 01

Bank A/c (14,000×105)

Dr.

 

14,70,000

 

 

To 12% Debentures Application A/c

 

 

 

14,70,000

 

(Application money for 14,000 debentures received)

 

 

 

 

 

 

 

 

 

 

April 01

12% Debentures Application A/c (14,000×105)

Dr

 

14,70,000

 

 

Loss on issue of Debentures (10,000×5)

Dr

 

50,000

 

 

  To 12% Debentures A/c (10,000×100)

 

 

 

10,00,000

 

  To Securities Premium Reserve A/c (10,000×5)

 

 

 

50,000

 

  To Bank A/c (4,000×105)

 

 

 

4,20,000

 

  To Premium on Redemption of Debentures A/c

 

 

 

50,000

 

(Application money transferred to 12% debentures A/c)

 

 

 

 

 

 

 

 

 

 

Sept 30

Debenture Interest A/c

Dr

 

60,000

 

 

    To 12% Debentures Holder A/c

 

 

 

60,000

 

(Interest on Debenture is payable)

 

 

 

 

 

 

 

 

 

 

Sept 30

12% Debentures Holder A/c

Dr

 

60,000

 

 

 To Bank A/c

 

 

 

54,000

 

   To TDS

 

 

 

6,000

 

(Interest on Debenture paid and tax deducted at source)

 

 

 

 

 

 

 

 

 

 

Oct. 01

Building A/c

Dr

 

10,00,000

 

 

Plant and Machinery A/c

Dr

 

8,00,000

 

 

Goodwill A/c (bal. figure)

Dr

 

1,50,000

 

 

  To Sundry liabilities A/c

 

 

 

3,00,000

 

  To Raman & Co.

 

 

 

16,50,000

 

(Assets and Liabilities of Raman & Co. taken over)

 

 

 

 

 

 

 

 

 

 

Oct. 01

Raman & Co. A/c

Dr

 

16,50,000

 

 

     To 12% Debentures A/c

 

 

 

15,00,000

 

     To Securities Premium Reserve A/c

 

 

 

1,50,000

 

( 15,000 Debentures paid as purchase price to Raman & Co.)

 

 

 

 

 

 

 

 

 

 

Oct. 01

Debentures Suspense A/c

Dr

 

15,00,000

 

 

   To 12% Debentures A/c

 

 

 

15,00,000

 

(15,000 12% Debentures issued as collateral security against a loan from ICICI Bank)

 

 

 

 

 

 

 

 

 

 

2017

 

 

 

 

 

Mar. 31

Debenture Interest A/c

Dr

 

60,000

 

 

    To 12% Debentures Holder A/c

 

 

 

60,000

 

( Interest on Debenture is payable)

 

 

 

 

 

 

 

 

 

 

Mar. 31

12% Debentures Holder A/c

Dr

 

60,000

 

 

 To Bank A/c

 

 

 

54,000

 

   To TDS

 

 

 

6,000

 

( Interest on Debenture is paid and tax is deducted at source)

 

 

 

 

 

 

 

 

 

 

Mar. 31

Statement of Profit and Loss

Dr

 

1,20,000

 

 

    To Debenture Interest A/c

 

 

 

1,20,000

 

(Debenture Interest charged to Profit and Loss A/c)

 

 

 

 

 

 

 

 

 

 

Mar. 31

Securities Premium Reserve A/c

Dr

 

50,000

 

 

  To Loss on Issue of Debentures

 

 

 

50,000

 

(Loss on issue of Debentures written off fully)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

             



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