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Rabiya Afreen
Subject: Accountancy
, asked on 31/12/17
X Ltd. purchased its own 500 debentures of the face value of Rs. 100 each at Rs. 94 and paid Rs. 250 as brokerage. These debentures were cancelled immediately.
Pass necessary journal entries.
Answer
2
Arunima Jalali
Subject: Accountancy
, asked on 30/12/17
Please answer ques 14 A part
Q14. [A] :- Mona Ltd has issued 20,000; 9% Debenture of Rs.100 each of which half the amount is due for redemption on 31
st
March, 2016. The company has in its Debenture Redemption Reserve account, a Balance of Rs. 4. 40,000. Record the necessary journal entries at the time of redemption of debenture [MARk - 3]
Answer
3
Ambareesh
Subject: Accountancy
, asked on 26/12/17
**solution for a and b**
Q). Kay Ltd. is a company manufacturing textiles. It has a share capital of 60 lakhs. In the previous year its earning per share was Rs. 0.50. For diversification, the company requires additional capital of 40 lakhs. The company raised funds by issuing 10% Debentures for the same. During the year the company earned profit of 8 lakhs on capital employed. It paid tax @ 40%.
(a). State whether the shareholders gained or lost, in respect of earning per share on diversification. Show your calculations clearly.
(b). Also, state any three factors that favour the issue of debentures by the company as part of its capital structure.
Answer
1
Ipsita Chakravarty
Subject: Accountancy
, asked on 17/12/17
Star textile ltd purchased assets of modern textiles ltd as under - building 2500000 at 4000000, plant and machinery of 1000000 at 750000 and furniture of 300000 at 100000 for purchase consideration of 4500000. Star textiles paid 300000 in cash and remaining by issue of 9 + debenture of 500 each at a premium of 5+ . Journlise in the books of star textiles ltd ?
Answer
1
Priyanka Trivedi
Subject: Accountancy
, asked on 23/11/17
AshimaLtdissued 2,500, 9% debentures of Rs.100 each on1
st
April 2015, redeemable at a premium of 8% after three years. According to the issue of prospectus Rs.40 is payable on application and the balance on allotment of debentures, record the necessary entries regarding the issue of debentures.
Answer
1
Vibhav
Subject: Accountancy
, asked on 23/11/17
can debentures be converted into shares at discount
normally shares cant be issued at discount but in this case can we convert the debentures into shares at discount
Answer
1
Vibhav
Subject: Accountancy
, asked on 22/11/17
Please update your study material Accounts by adding other methods of Redemption of Debentures (Purchase in open market and Conversion) in accordance with latest CBSE Syllabus
Answer
1
Tejasvita Goel
Subject: Accountancy
, asked on 11/11/17
Please solve this question I want to check my ans
14. Karan Enterprises Ltd. had an equity capital of Rs 1,00,00,000 but had no debt component in their capital structure. So in order to take the benefit of trading on equity, being the rate of interest less than return on investment: the Board of Directors decided to issue Rs 10,00,000, 8% Debentures of Rs 100 each at a premium of 5% on 1
st
April, 2011 redeemable after four years i.e. 31
st
March, 2015. They decided to transfer the required amount to Debenture Redemption Reserve in two equal instalment in the year ending 31
st
March 2014 and 2015. They decided to invest the required amount in government securities as per the provisions of Companies Act 2013. Debentures were redeemed on the due date Record necessary journal entries.
Answer
1
Riya
Subject: Accountancy
, asked on 9/11/17
Solve this:
PPP Limited invited applications for issuing 2,000 13% Debentures of Rs. 100 each at a discount of 10%. the full amount was payable on application. Application were received for 5,000 debentures. Give entries in the following cases:
Case 1 :
When all excess application are rejected.
Case 2 :
When all excess application are accepted
Case 3 :
When 2,000 applications are rejected and pro-rata allotment is made to the remaining.
[
Hint :
Money refunded in Case 1 : Rs. 2,70,000; Case 2 : Rs. 2,70,000; Case 3 : Rs. 2,70,000]
Answer
1
Kartik Arora
Subject: Accountancy
, asked on 8/11/17
Solve Q2. 2 X Ltd. Invited applications for issuing 1000, 9% debentures of ₹ 100 each at a discount of 6 percent .Applicants for 1,200 debentures were received . Pro-rata allotment was made to all the applications. Pass necessary journal entries for the issue of debentures assuming that whole amount was payable with applications.
Answer
3
Kartik Arora
Subject: Accountancy
, asked on 8/11/17
Solve this:
Jain Motors Ltd. converted its 200.8% Debentures of Rs. 100 each at a discount of 6% into equity shares of Rs. 10 each , issued at a premium of 25%. Discount on issue of 8% debentures has not yet been written off.
Showing your working notes clearly pass necessary journal entries on conversion of 8% debentures into equity
shares.
Answer
2
Kartik Arora
Subject: Accountancy
, asked on 8/11/17
Solve this:
On 1-4-2015 PVR Ltd. 750,11% debentures of Rs. 1000 each at a discount of 5% redmeeable at a premium of 10% after three years , Interest on debentures is payable on 30th September and 31st March. PVR Ltd. Closes its books on 31st March every year. The rate of deducted at source 10%.
Pass necessary Journal Entries for the issue of debentures and the payment interest for the year ended 31st March, 2016.
Answer
1
Kartik Arora
Subject: Accountancy
, asked on 8/11/17
Solve this:
On 1-4-2013 JN Ltd. had 10,000, 9% debentures Rs. 100 each outstanding.
(a) On 1-4-2014 the Company purchased in the open market 2000 of its own debentures for Rs. 101 each and
Cancelled the same immediately.
(b) On 14-2015 the company redeemed at par debentures of Rs. 4,00.000 by draw of a lot.
(c) On 28-2-2016 the remaining debentures were purchased for immediate cancellation for Rs. 3,97,000.
Pass necessary journal entries for the above transactions in the books of the company ignoring debentures redemption reserve and interest on debentures.
Answer
1
Vibhav
Subject: Accountancy
, asked on 5/11/17
Solve Q23
Answer
2
Vibhav
Subject: Accountancy
, asked on 5/11/17
Please solve Q23
Answer
1
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What are you looking for?
Pass necessary journal entries.
Q14. [A] :- Mona Ltd has issued 20,000; 9% Debenture of Rs.100 each of which half the amount is due for redemption on 31st March, 2016. The company has in its Debenture Redemption Reserve account, a Balance of Rs. 4. 40,000. Record the necessary journal entries at the time of redemption of debenture [MARk - 3]
Q). Kay Ltd. is a company manufacturing textiles. It has a share capital of 60 lakhs. In the previous year its earning per share was Rs. 0.50. For diversification, the company requires additional capital of 40 lakhs. The company raised funds by issuing 10% Debentures for the same. During the year the company earned profit of 8 lakhs on capital employed. It paid tax @ 40%.
(a). State whether the shareholders gained or lost, in respect of earning per share on diversification. Show your calculations clearly.
(b). Also, state any three factors that favour the issue of debentures by the company as part of its capital structure.
normally shares cant be issued at discount but in this case can we convert the debentures into shares at discount
14. Karan Enterprises Ltd. had an equity capital of Rs 1,00,00,000 but had no debt component in their capital structure. So in order to take the benefit of trading on equity, being the rate of interest less than return on investment: the Board of Directors decided to issue Rs 10,00,000, 8% Debentures of Rs 100 each at a premium of 5% on 1st April, 2011 redeemable after four years i.e. 31st March, 2015. They decided to transfer the required amount to Debenture Redemption Reserve in two equal instalment in the year ending 31st March 2014 and 2015. They decided to invest the required amount in government securities as per the provisions of Companies Act 2013. Debentures were redeemed on the due date Record necessary journal entries.
PPP Limited invited applications for issuing 2,000 13% Debentures of Rs. 100 each at a discount of 10%. the full amount was payable on application. Application were received for 5,000 debentures. Give entries in the following cases:
Case 1 : When all excess application are rejected.
Case 2 : When all excess application are accepted
Case 3 : When 2,000 applications are rejected and pro-rata allotment is made to the remaining.
[Hint : Money refunded in Case 1 : Rs. 2,70,000; Case 2 : Rs. 2,70,000; Case 3 : Rs. 2,70,000]
Jain Motors Ltd. converted its 200.8% Debentures of Rs. 100 each at a discount of 6% into equity shares of Rs. 10 each , issued at a premium of 25%. Discount on issue of 8% debentures has not yet been written off.
Showing your working notes clearly pass necessary journal entries on conversion of 8% debentures into equity
shares.
On 1-4-2015 PVR Ltd. 750,11% debentures of Rs. 1000 each at a discount of 5% redmeeable at a premium of 10% after three years , Interest on debentures is payable on 30th September and 31st March. PVR Ltd. Closes its books on 31st March every year. The rate of deducted at source 10%.
Pass necessary Journal Entries for the issue of debentures and the payment interest for the year ended 31st March, 2016.
On 1-4-2013 JN Ltd. had 10,000, 9% debentures Rs. 100 each outstanding.
(a) On 1-4-2014 the Company purchased in the open market 2000 of its own debentures for Rs. 101 each and
Cancelled the same immediately.
(b) On 14-2015 the company redeemed at par debentures of Rs. 4,00.000 by draw of a lot.
(c) On 28-2-2016 the remaining debentures were purchased for immediate cancellation for Rs. 3,97,000.
Pass necessary journal entries for the above transactions in the books of the company ignoring debentures redemption reserve and interest on debentures.