Double Entry Book Keeping Ts Grewal 2016 for Class 12 Commerce Accountancy Chapter 9 - Company Accounts Issue Of Debentures

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Page No 9.38:

Question 1:

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 9.38:

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 9.38:

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 9.38:

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 9.38:

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 9.38:

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 = \frac{Purchase Consideration}{Issue Price of Debentures} = \frac{5, 40, 000 (6, 00, 000 - 60, 000)}{100 + 20} = 4, 500

WN 2: Calculation of number of debentures issued

No. of debentures issued = \frac{Purchase Consideration}{Issue Price of Debentures} = \frac{5, 40, 000 (6, 00, 000 - 60, 000)}{100 - 10} = 6, 000

Page No 9.39:

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 = \frac{Purchase Consideration}{Issue Price of Debentures} = \frac{3, 30, 000}{110} = 3, 000

Page No 9.39:

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 Cash A/c				1,00,000
	(Payment made to A Ltd partially in cash and remaining by issue of 9% debentures at 10% premium)

Working Notes: Calculation of Number of Debentures issued

No. of debentures issued = \frac{Purchase Consideration}{Issue Price of Debentures} = \frac{4, 40, 000}{110} = 4, 000

Page No 9.39:

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 = \frac{Purchase Consideration}{Issue Price of Debentures} = \frac{6, 75, 000 (10, 00, 000 - 3, 25, 000)}{900 (1, 000 - 100)} = 750

Page No 9.39:

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 9.39:

Answer:

Journal
Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
	Building A/c	Dr.		9,00,000
	To Vendor’s A/c				9,00,000
	(Building purchased from vendor)

	Vendor’s A/c	Dr.		9,00,000
	To _% Debentures A/c				9,00,000
	(Issue debentures to vendor for purchase consideration)

Page No 9.39:

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 = \frac{Purchase Consideration}{Issue Price of Debentures} = \frac{6, 30, 000}{105} = 6,000

Page No 9.39:

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 9.39:

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 9.39:

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 9.39:

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 9.39:

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 9.39:

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 9.40:

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 9.40:

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 9.40:

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 9.40:

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 9.40:

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 9.40:

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 9.40:

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)