TS Grewal i (2014) Solutions for Class 12 Commerce Accountancy Chapter 9 Company Accounts Redemption Of Debentures are provided here with simple step-by-step explanations. These solutions for Company Accounts Redemption Of Debentures are extremely popular among class 12 Commerce students for Accountancy Company Accounts Redemption Of Debentures Solutions come handy for quickly completing your homework and preparing for exams. All questions and answers from the TS Grewal i (2014) Book of class 12 Commerce Accountancy Chapter 9 are provided here for you for free. You will also love the ad-free experience on Meritnation’s TS Grewal i (2014) Solutions. All TS Grewal i (2014) Solutions for class 12 Commerce Accountancy are prepared by experts and are 100% accurate.

Page No 9.25:

Question 1:

Answer:

In this case, as the maturity period of the issued debentures are not more than 18 months, so as per the SEBI's guidelines, the company is not required to create DRR. 

Page No 9.25:

Question 2:

In this case, as the maturity period of the issued debentures are not more than 18 months, so as per the SEBI's guidelines, the company is not required to create DRR. 

Answer:

The maturity period of the debenture is 12 months (i.e. from June 30, 2013 to June 30, 2014). As per the SEBI's guidelines, no DRR is required for the repayment of such debentures as their maturity period is less than the prescribed limit of 18 months.

Books of Nirabhi Chemicals Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

5,40,00,000

 

 

To 6% Debenture Application A/c

 

 

5,40,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

6% Debenture Application A/c

Dr.

 

5,00,00,000

 

 

To 6% Debentures A/c

 

 

5,00,00,000

 

To Securities Premium A/c

 

 

40,00,000

 

(Debenture application money transferred to debenture account)

 

 

 

 

 

 

 

 

 

6% Debentures A/c

Dr.

 

5,00,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,00,000

 

 

To Bank A/c

 

 

5,00,00,000

 

(Amount due for redemption paid to debenture holders)

 

 

 

 

 

 

 

 

 

Page No 9.25:

Question 3:

The maturity period of the debenture is 12 months (i.e. from June 30, 2013 to June 30, 2014). As per the SEBI's guidelines, no DRR is required for the repayment of such debentures as their maturity period is less than the prescribed limit of 18 months.

Books of Nirabhi Chemicals Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

5,40,00,000

 

 

To 6% Debenture Application A/c

 

 

5,40,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

6% Debenture Application A/c

Dr.

 

5,00,00,000

 

 

To 6% Debentures A/c

 

 

5,00,00,000

 

To Securities Premium A/c

 

 

40,00,000

 

(Debenture application money transferred to debenture account)

 

 

 

 

 

 

 

 

 

6% Debentures A/c

Dr.

 

5,00,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,00,000

 

 

To Bank A/c

 

 

5,00,00,000

 

(Amount due for redemption paid to debenture holders)

 

 

 

 

 

 

 

 

 

Answer:

Books of AFCONs India Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

5,00,00,000

 

 

To 9% Debenture Application A/c

 

 

5,00,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

9% Debenture Application A/c

Dr.

 

5,00,00,000

 

 

To 9% Debentures A/c

 

 

5,00,00,000

 

(Debenture application money transferred to debenture account)

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

5,00,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,00,000

 

 

To Bank A/c

 

 

5,00,00,000

 

(Amount due for redemption paid to debenture holders)

 

 

 

 

 

 

 

 

Note: As per the SEBI's guidelines, Infrastructure Companies are exempted from creating DRR. Hence, in this case, no DRR is to be created.

Page No 9.25:

Question 4:

Books of AFCONs India Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

5,00,00,000

 

 

To 9% Debenture Application A/c

 

 

5,00,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

9% Debenture Application A/c

Dr.

 

5,00,00,000

 

 

To 9% Debentures A/c

 

 

5,00,00,000

 

(Debenture application money transferred to debenture account)

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

5,00,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,00,000

 

 

To Bank A/c

 

 

5,00,00,000

 

(Amount due for redemption paid to debenture holders)

 

 

 

 

 

 

 

 

Note: As per the SEBI's guidelines, Infrastructure Companies are exempted from creating DRR. Hence, in this case, no DRR is to be created.

Answer:

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2003

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

60,000

 

 

To Debenture Redemption Reserve A/c

 

 

60,000

 

(Profit transferred to D.R.R)

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

8,00,000

 

 

To Debentureholders’ A/c

 

 

8,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

8,00,000

 

 

To Bank A/c

 

 

8,00,000

 

(Amount due to debentureholders paid)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

4,00,000

 

 

To General Reserve

 

 

4,00,000

 

(D.R.R transferred to Capital Reserve)

 

 

 

 

 

 

 

 

Working Note:

Page No 9.25:

Question 5:

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2003

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

60,000

 

 

To Debenture Redemption Reserve A/c

 

 

60,000

 

(Profit transferred to D.R.R)

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

8,00,000

 

 

To Debentureholders’ A/c

 

 

8,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

8,00,000

 

 

To Bank A/c

 

 

8,00,000

 

(Amount due to debentureholders paid)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

4,00,000

 

 

To General Reserve

 

 

4,00,000

 

(D.R.R transferred to Capital Reserve)

 

 

 

 

 

 

 

 

Working Note:

Answer:

Books of W Ltd.

Journal

Date.

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Profit and Loss Appropriation A/c

Dr.

 

1,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

1,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

3,00,000

 

 

To Debentureholders’ A/c

 

 

3,00,000

 

(Debenture due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

3,00,000

 

 

To Bank A/c

 

 

3,00,000

 

(Amount due to debentureholders paid)

 

 

 

 

 

 

 

 

 

Page No 9.25:

Question 6:

Books of W Ltd.

Journal

Date.

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Profit and Loss Appropriation A/c

Dr.

 

1,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

1,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

3,00,000

 

 

To Debentureholders’ A/c

 

 

3,00,000

 

(Debenture due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

3,00,000

 

 

To Bank A/c

 

 

3,00,000

 

(Amount due to debentureholders paid)

 

 

 

 

 

 

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Profit and Loss Appropriation A/c

Dr.

 

1,20,000

 

 

To Debenture Redemption Reserve A/c

 

 

1,20,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

Debenture A/c

Dr.

 

1,20,000

 

 

Premium on Redemption of Debenture A/c

Dr.

 

6,000

 

 

To Debentureholders’ A/c

 

 

1,26,000

 

(Debenture due for redemption along with premium)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

1,26,000

 

 

To Bank A/c

Dr.

 

 

1,26,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

1,20,000

 

 

To General Reserve A/c

 

 

1,20,000

 

(Debenture Redemption Reserve transferred to Capital Reserve)

 

 

 

 

 

 

 

 

 

Page No 9.25:

Question 7:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Profit and Loss Appropriation A/c

Dr.

 

1,20,000

 

 

To Debenture Redemption Reserve A/c

 

 

1,20,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

Debenture A/c

Dr.

 

1,20,000

 

 

Premium on Redemption of Debenture A/c

Dr.

 

6,000

 

 

To Debentureholders’ A/c

 

 

1,26,000

 

(Debenture due for redemption along with premium)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

1,26,000

 

 

To Bank A/c

Dr.

 

 

1,26,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

1,20,000

 

 

To General Reserve A/c

 

 

1,20,000

 

(Debenture Redemption Reserve transferred to Capital Reserve)

 

 

 

 

 

 

 

 

 

Answer:

In the Books of Mansi Ltd.

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

31/3/2011

Statement of Profit and Loss

Dr.

 

6,00,000

 

 

   To Debenture Redemption Reserve

 

 

 

 

 

(Being DRR created)

 

 

 

6,00,000

 

 

 

 

 

 

 

10% Debentures A/c

Dr.

 

6,00,000

 

 

   To Debentureholders A/c

 

 

 

6,00,000

 

(Being 6000; 10% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders A/c

Dr.

 

6,00,000

 

 

   To Bank A/c

 

 

 

6,00,000

 

(Being amount paid)

 

 

 

 

           
  Debenture Redemption Reserve Dr.   6,00,000  
     To General Reserve       6,00,000

 

 

 

 

 

 

 

Page No 9.25:

Question 8:

In the Books of Mansi Ltd.

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

31/3/2011

Statement of Profit and Loss

Dr.

 

6,00,000

 

 

   To Debenture Redemption Reserve

 

 

 

 

 

(Being DRR created)

 

 

 

6,00,000

 

 

 

 

 

 

 

10% Debentures A/c

Dr.

 

6,00,000

 

 

   To Debentureholders A/c

 

 

 

6,00,000

 

(Being 6000; 10% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders A/c

Dr.

 

6,00,000

 

 

   To Bank A/c

 

 

 

6,00,000

 

(Being amount paid)

 

 

 

 

           
  Debenture Redemption Reserve Dr.   6,00,000  
     To General Reserve       6,00,000

 

 

 

 

 

 

 

Answer:

Books of India Textiles Corporation Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

March 31

Profit and Loss Appropriation A/c

Dr.

 

22,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

22,00,000

 

(Profit transferred to Debenture Redemption Reserve (25,00,000-3,00,000))

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

50,00,000

 

 

To Debentureholders’ A/c

 

 

50,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

50,00,000

 

 

To Bank A/c

 

 

50,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

25,00,000

 

 

To General Reserve A/c

 

 

25,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 



Page No 9.26:

Question 9:

Books of India Textiles Corporation Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

March 31

Profit and Loss Appropriation A/c

Dr.

 

22,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

22,00,000

 

(Profit transferred to Debenture Redemption Reserve (25,00,000-3,00,000))

 

 

 

 

 

 

 

 

 

9% Debentures A/c

Dr.

 

50,00,000

 

 

To Debentureholders’ A/c

 

 

50,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

50,00,000

 

 

To Bank A/c

 

 

50,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

25,00,000

 

 

To General Reserve A/c

 

 

25,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2007

 

 

 

 

April 01

Bank A/c

Dr.

 

40,00,000

 

 

To 8% Debenture Application A/c

 

 

40,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

8% Debenture Application A/c

Dr.

 

40,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

2,00,000

 

 

To 8% Debentures A/c

 

 

40,00,000

 

To Premium on Redemption of Debenture

 

 

2,00,000

 

(Debenture issued with the term repayable at 5% premium)

 

 

 

 

 

 

 

 

2008

 

 

 

 

 

March, 31

Profit and Loss Appropriation A/c

Dr.

 

10,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

10,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

10,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

10,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

June 30

8% Debentures A/c

Dr.

 

40,00,000

 

 

Premium on Redemption of Debenture A/c

Dr.

 

2,00,000

 

 

To Debentureholders’ A/c

 

 

42,00,000

 

(Debenture due for redemption along with premium)

 

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

20,00,000

 

 

To General Reserve A/c

 

 

20,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Page No 9.26:

Question 10:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2007

 

 

 

 

April 01

Bank A/c

Dr.

 

40,00,000

 

 

To 8% Debenture Application A/c

 

 

40,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

8% Debenture Application A/c

Dr.

 

40,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

2,00,000

 

 

To 8% Debentures A/c

 

 

40,00,000

 

To Premium on Redemption of Debenture

 

 

2,00,000

 

(Debenture issued with the term repayable at 5% premium)

 

 

 

 

 

 

 

 

2008

 

 

 

 

 

March, 31

Profit and Loss Appropriation A/c

Dr.

 

10,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

10,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

10,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

10,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

June 30

8% Debentures A/c

Dr.

 

40,00,000

 

 

Premium on Redemption of Debenture A/c

Dr.

 

2,00,000

 

 

To Debentureholders’ A/c

 

 

42,00,000

 

(Debenture due for redemption along with premium)

 

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

20,00,000

 

 

To General Reserve A/c

 

 

20,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Answer:

Books of Godrej Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Profit and Loss Appropriation A/c

Dr.

 

6,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

6,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

7% Debentures A/c

Dr.

 

20,00,000

 

 

To Debentureholders’ A/c

 

 

20,00,000

 

(Amount due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

20,00,000

 

 

To Bank A/c

 

 

20,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

10,00,000

 

 

To General Reserve A/c

 

 

10,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Debenture Redemption Reserve

=

 

 

=

Rs

10,00,000

Less: D.R.R already made

=

Rs

(3,50,000)

Profit to be transferred to D.R.R

=

Rs

6,50,000

 

Page No 9.26:

Question 11:

Books of Godrej Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Profit and Loss Appropriation A/c

Dr.

 

6,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

6,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

7% Debentures A/c

Dr.

 

20,00,000

 

 

To Debentureholders’ A/c

 

 

20,00,000

 

(Amount due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

20,00,000

 

 

To Bank A/c

 

 

20,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

10,00,000

 

 

To General Reserve A/c

 

 

10,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Debenture Redemption Reserve

=

 

 

=

Rs

10,00,000

Less: D.R.R already made

=

Rs

(3,50,000)

Profit to be transferred to D.R.R

=

Rs

6,50,000

 

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2002

 

 

 

 

March 31

Bank A/c

Dr.

 

21,00,000

 

 

To 8% Debenture Application A/c

 

 

21,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

8% Debenture Application A/c

Dr.

 

21,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,68,000

 

 

To 8% Debenture A/c

 

 

21,00,000

 

To Premium on Redemption A/c

 

 

1,68,000

 

(21,00,000 8% Debentures of Rs 10 each issued with the term repayable at 8% Premium)

 

 

 

 

 

 

 

 

2007

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

3,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

3,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2008

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

3,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

3,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

Mach 31

Profit and Loss Appropriation A/c

Dr.

 

3,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

3,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

June 30

8% Debenture A/c

Dr.

 

21,00,000

 

 

Premium on Redemption Reserve A/c

Dr.

 

1,68,000

 

 

To Debentureholders’ A/c

 

 

22,68,000

 

(Debenture due for redemption along with premium)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

22,68,000

 

 

To Bank A/c

 

 

22,68,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

10,50,000

 

 

To General Reserve A/c

 

 

10,50,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Page No 9.26:

Question 12:

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2002

 

 

 

 

March 31

Bank A/c

Dr.

 

21,00,000

 

 

To 8% Debenture Application A/c

 

 

21,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

8% Debenture Application A/c

Dr.

 

21,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,68,000

 

 

To 8% Debenture A/c

 

 

21,00,000

 

To Premium on Redemption A/c

 

 

1,68,000

 

(21,00,000 8% Debentures of Rs 10 each issued with the term repayable at 8% Premium)

 

 

 

 

 

 

 

 

2007

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

3,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

3,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2008

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

3,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

3,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

Mach 31

Profit and Loss Appropriation A/c

Dr.

 

3,50,000

 

 

To Debenture Redemption Reserve A/c

 

 

3,50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

June 30

8% Debenture A/c

Dr.

 

21,00,000

 

 

Premium on Redemption Reserve A/c

Dr.

 

1,68,000

 

 

To Debentureholders’ A/c

 

 

22,68,000

 

(Debenture due for redemption along with premium)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

22,68,000

 

 

To Bank A/c

 

 

22,68,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

10,50,000

 

 

To General Reserve A/c

 

 

10,50,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Answer:

Books of Footfall Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

10,00,000

 

 

To Debenture Application A/c

 

 

10,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

10,00,000

 

 

Loss on Issue of Debentures A/c

 

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 with term redeemable at 5% premium)

 

 

 

 

 

 

 

 

 

Profit and Loss A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

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)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,50,000

 

 

To Bank A/c

 

 

10,50,000

 

(Amount paid to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Page No 9.26:

Question 13:

Books of Footfall Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

10,00,000

 

 

To Debenture Application A/c

 

 

10,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

10,00,000

 

 

Loss on Issue of Debentures A/c

 

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 with term redeemable at 5% premium)

 

 

 

 

 

 

 

 

 

Profit and Loss A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

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)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,50,000

 

 

To Bank A/c

 

 

10,50,000

 

(Amount paid to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Answer:

Books of PQ Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

10,00,000

 

 

To Debenture Application A/c

 

 

10,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application 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 A/c

 

 

1,00,000

 

(10,000 Debenture of Rs 100 each issued with the term redeemable at 10% premium)

 

 

 

 

 

 

 

 

 

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

Debentures A/c

Dr.

 

10,00,000

 

 

Premium on Redemption of Debentures A/c

Dr.

 

1,00,000

 

 

To Debentureholders’ A/c

 

 

11,00,000

 

(Debenture along with premium on redemption due for redemption)

 

 

 

 

 

 

11,00,000

 

 

Debentureholders’ A/c

Dr.

 

 

11,00,000

 

   To Bank A/c

 

 

 

 

(Amount paid to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Page No 9.26:

Question 14:

Books of PQ Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

Bank A/c

Dr.

 

10,00,000

 

 

To Debenture Application A/c

 

 

10,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application 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 A/c

 

 

1,00,000

 

(10,000 Debenture of Rs 100 each issued with the term redeemable at 10% premium)

 

 

 

 

 

 

 

 

 

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

 

Debentures A/c

Dr.

 

10,00,000

 

 

Premium on Redemption of Debentures A/c

Dr.

 

1,00,000

 

 

To Debentureholders’ A/c

 

 

11,00,000

 

(Debenture along with premium on redemption due for redemption)

 

 

 

 

 

 

11,00,000

 

 

Debentureholders’ A/c

Dr.

 

 

11,00,000

 

   To Bank A/c

 

 

 

 

(Amount paid to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Answer:

Books of JB Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2001

 

 

 

 

Jan.01

Bank A/c

Dr.

 

10,40,000

 

 

To 6% Debenture Application A/c

 

 

10,40,000

 

(Debenture Application money received)

 

 

 

 

 

 

 

 

Jan.01

6% Debenture Application A/c

Dr.

 

10,40,000

 

 

Loss on Issue of Debenture A/c

Dr.

 

50,000

 

 

To 6% Debentures A/c

 

 

10,00,000

 

To Securities Premium A/c

 

 

40,000

 

To Premium on Redemption A/c

 

 

50,000

 

(Debentures of Rs 10,00,000 issued at 4% Premium with the term redeemable at 5% Premium)

 

 

 

 

 

 

 

 

 

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2002

 

 

 

 

Dec.31

6% 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 the premium)

 

 

 

 

 

 

 

 

Dec.31

Debentureholders’ A/c

Dr.

 

10,50,000

 

 

   To Bank A/c

 

 

10,50,000

 

(Amount paid to Debentureholders)

 

 

 

 

 

 

 

 

Dec.31

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Note- Here, as nothing specific has been mentioned in the question regarding the source of redemption. Therefore, it has been assumed that the debentures are redeemed 50% out of profit and 50% out of capital. Hence, only 50% of the face-value of the debentures issued has been transferred to the DRR Account. 

Page No 9.26:

Question 15:

Books of JB Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2001

 

 

 

 

Jan.01

Bank A/c

Dr.

 

10,40,000

 

 

To 6% Debenture Application A/c

 

 

10,40,000

 

(Debenture Application money received)

 

 

 

 

 

 

 

 

Jan.01

6% Debenture Application A/c

Dr.

 

10,40,000

 

 

Loss on Issue of Debenture A/c

Dr.

 

50,000

 

 

To 6% Debentures A/c

 

 

10,00,000

 

To Securities Premium A/c

 

 

40,000

 

To Premium on Redemption A/c

 

 

50,000

 

(Debentures of Rs 10,00,000 issued at 4% Premium with the term redeemable at 5% Premium)

 

 

 

 

 

 

 

 

 

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2002

 

 

 

 

Dec.31

6% 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 the premium)

 

 

 

 

 

 

 

 

Dec.31

Debentureholders’ A/c

Dr.

 

10,50,000

 

 

   To Bank A/c

 

 

10,50,000

 

(Amount paid to Debentureholders)

 

 

 

 

 

 

 

 

Dec.31

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Note- Here, as nothing specific has been mentioned in the question regarding the source of redemption. Therefore, it has been assumed that the debentures are redeemed 50% out of profit and 50% out of capital. Hence, only 50% of the face-value of the debentures issued has been transferred to the DRR Account. 

Answer:

Books of Raja Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2006

 

 

 

 

 

Jan.01

Bank A/c

Dr.

 

5,00,000

 

 

To 10% Debenture Application A/c

 

 

5,00,000

 

(Debenture application received)

 

 

 

 

 

 

 

 

 

10% Debenture Application A/c

Dr.

 

5,00,000

 

 

Loss on Issue of Debenture A/c

Dr.

 

25,000

 

 

To 10% Debentures A/c

 

 

5,00,000

 

To Premium on Redemption A/c

 

 

25,000

 

(5,000 10% Debentures of Rs 100 each issued with the term redeemable at 5% premium)

 

 

 

 

 

 

 

 

 

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Amount transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2010

 

 

 

 

Dec.31

10% Debentures A/c

Dr.

 

5,00,000

 

 

Premium on Redemption A/c

Dr.

 

25,000

 

 

To Debentureholders’ A/c

 

 

5,25,000

 

(Debenture due for redemption along with Premium on redemption)

 

 

 

 

 

 

 

 

Dec.31

Debentureholders’ A/c

Dr.

 

5,25,000

 

 

   To Bank A/c

 

 

5,25,000

 

(Amount paid to Debentureholders)

 

 

 

 

 

 

 

 

Dec.31

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

             

Note- Here, amount equal to 100% of the face-value of the debentures issued has been transferred to DRR, as it is mentioned in the question that the debentures are redeemed out of profits.

Page No 9.26:

Question 16:

Books of Raja Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2006

 

 

 

 

 

Jan.01

Bank A/c

Dr.

 

5,00,000

 

 

To 10% Debenture Application A/c

 

 

5,00,000

 

(Debenture application received)

 

 

 

 

 

 

 

 

 

10% Debenture Application A/c

Dr.

 

5,00,000

 

 

Loss on Issue of Debenture A/c

Dr.

 

25,000

 

 

To 10% Debentures A/c

 

 

5,00,000

 

To Premium on Redemption A/c

 

 

25,000

 

(5,000 10% Debentures of Rs 100 each issued with the term redeemable at 5% premium)

 

 

 

 

 

 

 

 

 

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Amount transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2010

 

 

 

 

Dec.31

10% Debentures A/c

Dr.

 

5,00,000

 

 

Premium on Redemption A/c

Dr.

 

25,000

 

 

To Debentureholders’ A/c

 

 

5,25,000

 

(Debenture due for redemption along with Premium on redemption)

 

 

 

 

 

 

 

 

Dec.31

Debentureholders’ A/c

Dr.

 

5,25,000

 

 

   To Bank A/c

 

 

5,25,000

 

(Amount paid to Debentureholders)

 

 

 

 

 

 

 

 

Dec.31

Debenture Redemption Reserve A/c

Dr.

 

5,00,000

 

 

To General Reserve A/c

 

 

5,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

             

Note- Here, amount equal to 100% of the face-value of the debentures issued has been transferred to DRR, as it is mentioned in the question that the debentures are redeemed out of profits.

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2010

 

 

 

 

 

Mar 31

10% Debentures A/c

Dr.

 

15,00,000

 

 

To Debentureholders A/c

 

 

 

15,00,000

 

(Being 10% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders A/c

Dr.

 

15,00,000

 

 

To Bank A/c

 

 

 

15,00,000

 

(Being amount paid)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit and Loss

Dr.

 

2,50,000

 

 

To Debenture Redemption Reserve

 

 

 

2,50,000

 

(Being DRR created)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Page No 9.26:

Question 17:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2010

 

 

 

 

 

Mar 31

10% Debentures A/c

Dr.

 

15,00,000

 

 

To Debentureholders A/c

 

 

 

15,00,000

 

(Being 10% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

 

 

Debentureholders A/c

Dr.

 

15,00,000

 

 

To Bank A/c

 

 

 

15,00,000

 

(Being amount paid)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit and Loss

Dr.

 

2,50,000

 

 

To Debenture Redemption Reserve

 

 

 

2,50,000

 

(Being DRR created)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answer:

Books of Rich Sugar Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2006

 

 

 

 

 

April 01

Bank A/c

Dr.

 

20,00,000

 

 

To 8% Debenture Application A/c

 

 

20,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

8% Debenture Application A/c

Dr.

 

20,00,000

 

 

To 8% Debentures A/c

 

 

20,00,000

 

(Debenture application transferred to 8% Debentures account)

 

 

 

 

 

 

 

 

2007

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

50,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2008

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’A/c

 

 

5,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

April 01

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

2009

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

 

 

 

 

 

2010

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

 

 

 

 

 

2011

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,000

 

(Debenture due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

10,00,000

 

 

To General Reserve A/c

 

 

10,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 



Page No 9.27:

Question 18:

Books of Rich Sugar Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2006

 

 

 

 

 

April 01

Bank A/c

Dr.

 

20,00,000

 

 

To 8% Debenture Application A/c

 

 

20,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

8% Debenture Application A/c

Dr.

 

20,00,000

 

 

To 8% Debentures A/c

 

 

20,00,000

 

(Debenture application transferred to 8% Debentures account)

 

 

 

 

 

 

 

 

2007

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

50,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2008

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

5,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

5,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’A/c

 

 

5,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

April 01

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

2009

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

 

 

 

 

 

2010

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,000

 

(Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

 

 

 

 

 

2011

 

 

 

 

April 01

8% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,000

 

(Debenture due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Amount of debentures paid to debentureholders)

 

 

 

 

 

 

 

 

 

Debenture Redemption Reserve A/c

Dr.

 

10,00,000

 

 

To General Reserve A/c

 

 

10,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

 

Answer:

Books of Tata Power Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2009

 

 

 

 

July 01

Bank A/c

Dr.

 

40,00,000

 

 

To 7% Debenture Application A/c

 

 

40,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

40,00,000

 

 

Loss on issue of Debentures A/c

Dr.

 

2,00,000

 

 

To 7% Debentures A/c

 

 

40,00,000

 

To Premium on Redemption A/c

 

 

2,00,000

 

(40,000 7% Debenture of Rs 100 each issued)

 

 

 

 

 

 

 

 

2010

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

10,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

10,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2011

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

4,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

4,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2012

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

6,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

6,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

March 31

7% Debenture A/c

Dr.

 

16,00,000

 

 

Premium on Redemption A/c

Dr.

 

80,000

 

 

To Debentureholders’ A/c

 

 

16,80,000

 

(16,000 7% Debenture of Rs 100 each due for redemption along 5% Premium on redemption)

 

 

 

 

 

 

 

 

March 31

Debenture holders

Dr.

 

16,80,000

 

 

To Bank A/c

 

 

16,80,000

 

(Amount paid to debenture holders)

 

 

 

 

 

 

 

 

2013

 

 

 

 

March 31

7% Debenture A/c

Dr.

 

16,00,000

 

 

Premium on Redemption of Debentures A/c

Dr.

 

80,000

 

 

To Debenture holders

 

 

16,80,000

 

(16,000 7% Debentures of Rs 100 each due for redemption along with 5% premium on redemption)

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

16,80,000

 

 

To Bank A/c

 

 

16,80,000

 

(Amount paid to debenture holders)

 

 

 

 

 

 

 

 

2014

 

 

 

 

March 31

7% Debenture A/c

Dr.

 

8,00,000

 

 

Premium on Redemption of Debentures A/c

Dr.

 

40,000

 

 

To Debenture holders

 

 

8,40,000

 

(8,000 7% Debentures of Rs 100 each due for redemption along with 5% premium on redemption)

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

8,40,000

 

 

To Bank A/c

 

 

8,40,000

 

(Payment made to debenture holders)

 

 

 

 

 

 

 

 

March 31

Debenture Redemption Reserve A/c

Dr.

 

20,00,000

 

 

To General Reserve A/c

 

 

20,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Amount for DRR

Amount to be transferred to Debenture Redemption Reserve on March 31, 2012

= 20,00,000 − 10,00,000 − 4,00,000 = Rs 6,00,000

Page No 9.27:

Question 19:

Books of Tata Power Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2009

 

 

 

 

July 01

Bank A/c

Dr.

 

40,00,000

 

 

To 7% Debenture Application A/c

 

 

40,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

40,00,000

 

 

Loss on issue of Debentures A/c

Dr.

 

2,00,000

 

 

To 7% Debentures A/c

 

 

40,00,000

 

To Premium on Redemption A/c

 

 

2,00,000

 

(40,000 7% Debenture of Rs 100 each issued)

 

 

 

 

 

 

 

 

2010

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

10,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

10,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2011

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

4,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

4,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2012

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

6,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

6,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

March 31

7% Debenture A/c

Dr.

 

16,00,000

 

 

Premium on Redemption A/c

Dr.

 

80,000

 

 

To Debentureholders’ A/c

 

 

16,80,000

 

(16,000 7% Debenture of Rs 100 each due for redemption along 5% Premium on redemption)

 

 

 

 

 

 

 

 

March 31

Debenture holders

Dr.

 

16,80,000

 

 

To Bank A/c

 

 

16,80,000

 

(Amount paid to debenture holders)

 

 

 

 

 

 

 

 

2013

 

 

 

 

March 31

7% Debenture A/c

Dr.

 

16,00,000

 

 

Premium on Redemption of Debentures A/c

Dr.

 

80,000

 

 

To Debenture holders

 

 

16,80,000

 

(16,000 7% Debentures of Rs 100 each due for redemption along with 5% premium on redemption)

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

16,80,000

 

 

To Bank A/c

 

 

16,80,000

 

(Amount paid to debenture holders)

 

 

 

 

 

 

 

 

2014

 

 

 

 

March 31

7% Debenture A/c

Dr.

 

8,00,000

 

 

Premium on Redemption of Debentures A/c

Dr.

 

40,000

 

 

To Debenture holders

 

 

8,40,000

 

(8,000 7% Debentures of Rs 100 each due for redemption along with 5% premium on redemption)

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

8,40,000

 

 

To Bank A/c

 

 

8,40,000

 

(Payment made to debenture holders)

 

 

 

 

 

 

 

 

March 31

Debenture Redemption Reserve A/c

Dr.

 

20,00,000

 

 

To General Reserve A/c

 

 

20,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Amount for DRR

Amount to be transferred to Debenture Redemption Reserve on March 31, 2012

= 20,00,000 − 10,00,000 − 4,00,000 = Rs 6,00,000

Answer:

Books of HP Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2005

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

8,00,00,000

 

 

To Debenture Redemption Reserve

 

 

8,00,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

March 31

8% Debenture A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2006

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentur holders)

 

 

 

 

 

 

 

 

2007

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2008

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2009

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2010

 

 

 

 

March 31

Debenture Redemption Reserve A/c

Dr.

 

25,00,00,000

 

 

To General Reserve A/c

 

 

25,00,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Amount for D.R.R.

Debenture Redemption Reserve required

=

Rs

25,00,00,000

Less: Debenture Redemption Reserve already created

=

Rs

(17,00,00,000)

D.R.R. to be created for redemption

=

Rs

8,00,00,000

 

Page No 9.27:

Question 20:

Books of HP Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2005

 

 

 

 

March 31

Profit and Loss Appropriation A/c

Dr.

 

8,00,00,000

 

 

To Debenture Redemption Reserve

 

 

8,00,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

March 31

8% Debenture A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

March 31

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2006

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentur holders)

 

 

 

 

 

 

 

 

2007

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2008

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2009

 

 

 

 

March 31

8% Debentures A/c

Dr.

 

10,00,00,000

 

 

To Debentureholders’ A/c

 

 

10,00,00,000

 

(20,00,000 8% Debenture of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

10,00,00,000

 

 

To Bank A/c

 

 

10,00,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2010

 

 

 

 

March 31

Debenture Redemption Reserve A/c

Dr.

 

25,00,00,000

 

 

To General Reserve A/c

 

 

25,00,00,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Amount for D.R.R.

Debenture Redemption Reserve required

=

Rs

25,00,00,000

Less: Debenture Redemption Reserve already created

=

Rs

(17,00,00,000)

D.R.R. to be created for redemption

=

Rs

8,00,00,000

 

Answer:

Shakti Enterprises Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2006

 

 

 

 

Oct. 01

Bank A/c

Dr.

 

35,00,000

 

 

To 6.5% Debenture Application A/c

 

 

35,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

6.5% Debenture Application A/c

Dr.

 

35,00,000

 

 

To 6.5% Debentures A/c

 

 

35,00,000

 

(Debenture application money transferred to debenture account)

 

 

 

 

 

 

 

 

2007

 

 

 

 

Mar. 31

Profit and Loss Appropriation A/c

Dr.

 

50,000

 

 

To Debenture Redemption Reserve A/c

 

 

50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2008

 

 

 

 

Mar. 31

Profit and Loss Appropriation A/c

Dr.

 

4,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

4,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

Mar. 31

Profit and Loss Appropriation A/c

Dr.

 

13,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

13,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2010

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures of Rs 100 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2011

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000, 6.5% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2012

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2013

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures due for debenture holders)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2014

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholder’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2014

 

 

 

 

Mar. 31

Debenture Redemption Reserve A/c

Dr.

 

17,50,000

 

 

To Genera Reserve A/c

 

 

17,50,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Amount for D.R.R.

Debenture Redemption Reserve required

=

17,50,000

Less: Profit transferred to D.R.R in 2007

=

(50,000)

Less: Profit transferred to D.R.R in 2008

=

(4,00,000)

D.R.R to be created

=

13,00,000

 

Page No 9.27:

Question 21:

Shakti Enterprises Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

2006

 

 

 

 

Oct. 01

Bank A/c

Dr.

 

35,00,000

 

 

To 6.5% Debenture Application A/c

 

 

35,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

6.5% Debenture Application A/c

Dr.

 

35,00,000

 

 

To 6.5% Debentures A/c

 

 

35,00,000

 

(Debenture application money transferred to debenture account)

 

 

 

 

 

 

 

 

2007

 

 

 

 

Mar. 31

Profit and Loss Appropriation A/c

Dr.

 

50,000

 

 

To Debenture Redemption Reserve A/c

 

 

50,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2008

 

 

 

 

Mar. 31

Profit and Loss Appropriation A/c

Dr.

 

4,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

4,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2009

 

 

 

 

Mar. 31

Profit and Loss Appropriation A/c

Dr.

 

13,00,000

 

 

To Debenture Redemption Reserve A/c

 

 

13,00,000

 

(Profit transferred to Debenture Redemption Reserve)

 

 

 

 

 

 

 

 

2010

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures of Rs 100 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2011

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000, 6.5% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2012

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2013

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholders’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures due for debenture holders)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2014

 

 

 

 

Mar. 31

6.5% Debentures A/c

Dr.

 

7,00,000

 

 

To Debentureholder’ A/c

 

 

7,00,000

 

(7,000 6.5% Debentures due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

7,00,000

 

 

To Bank A/c

 

 

7,00,000

 

(Payment made to debentureholders)

 

 

 

 

 

 

 

 

2014

 

 

 

 

Mar. 31

Debenture Redemption Reserve A/c

Dr.

 

17,50,000

 

 

To Genera Reserve A/c

 

 

17,50,000

 

(Debenture Redemption Reserve transferred to General Reserve)

 

 

 

 

 

 

 

 

Working Note:

Amount for D.R.R.

Debenture Redemption Reserve required

=

17,50,000

Less: Profit transferred to D.R.R in 2007

=

(50,000)

Less: Profit transferred to D.R.R in 2008

=

(4,00,000)

D.R.R to be created

=

13,00,000

 

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Own Debentures A/c (1000×92)

Dr.

 

92,000

 

 

   To Bank A/c

 

 

 

92,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Debentures A/c

Dr.

 

1,00,000

 

 

   To Own Debentures A/c

 

 

 

92,000

 

   To Profit on cancellation of own debentures A/c

 

 

 

8,000

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

8,000

 

 

   To Capital Reserve A/c

 

 

 

8,000

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Page No 9.27:

Question 22:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Own Debentures A/c (1000×92)

Dr.

 

92,000

 

 

   To Bank A/c

 

 

 

92,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Debentures A/c

Dr.

 

1,00,000

 

 

   To Own Debentures A/c

 

 

 

92,000

 

   To Profit on cancellation of own debentures A/c

 

 

 

8,000

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

8,000

 

 

   To Capital Reserve A/c

 

 

 

8,000

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

2010

 

 

 

 

 

30th June

Debentures Interest A/c

Dr.

 

6,000

 

 

   To Bank A/c

 

 

 

6,000

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

1st July

Own Debentures A/c (300×93)

Dr.

 

27,900

 

 

   To Bank A/c

 

 

 

27,900

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

12% Debentures A/c

Dr.

 

30,000

 

 

   To Own Debentures A/c

 

 

 

27,900

 

   To Profit on cancellation of own debentures A/c

 

 

 

2,100

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

2,100

 

 

   To Capital Reserve A/c

 

 

 

2,100

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Page No 9.27:

Question 23:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

2010

 

 

 

 

 

30th June

Debentures Interest A/c

Dr.

 

6,000

 

 

   To Bank A/c

 

 

 

6,000

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

1st July

Own Debentures A/c (300×93)

Dr.

 

27,900

 

 

   To Bank A/c

 

 

 

27,900

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

12% Debentures A/c

Dr.

 

30,000

 

 

   To Own Debentures A/c

 

 

 

27,900

 

   To Profit on cancellation of own debentures A/c

 

 

 

2,100

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

2,100

 

 

   To Capital Reserve A/c

 

 

 

2,100

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Own Debentures A/c (250×98)

Dr.

 

24,500

 

 

   To Bank A/c

 

 

 

24,500

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Own Debentures A/c

Dr.

 

50

 

 

   To Bank A/c

 

 

 

50

 

(Expenses for purchase of own debentures paid)

 

 

 

 

 

 

 

 

 

 

 

15% Debentures A/c

Dr.

 

25,000

 

 

   To Own Debentures A/c (24500+50)

 

 

 

24,550

 

   To Profit on cancellation of own debentures A/c

 

 

 

450

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

450

 

 

   To Capital Reserve A/c

 

 

 

450

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Page No 9.27:

Question 24:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Own Debentures A/c (250×98)

Dr.

 

24,500

 

 

   To Bank A/c

 

 

 

24,500

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Own Debentures A/c

Dr.

 

50

 

 

   To Bank A/c

 

 

 

50

 

(Expenses for purchase of own debentures paid)

 

 

 

 

 

 

 

 

 

 

 

15% Debentures A/c

Dr.

 

25,000

 

 

   To Own Debentures A/c (24500+50)

 

 

 

24,550

 

   To Profit on cancellation of own debentures A/c

 

 

 

450

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

450

 

 

   To Capital Reserve A/c

 

 

 

450

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Own Debentures A/c (8,000×160)

Dr.

 

12,80,000

 

 

   To Bank A/c

 

 

 

12,80,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

7% Debentures A/c

Dr.

 

16,00,000

 

 

   To Own Debentures A/c

 

 

 

12,80,000

 

   To Profit on cancellation of own debentures A/c

 

 

 

3,20,000

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

3,20,000

 

 

   To Capital Reserve A/c

 

 

 

3,20,000

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Page No 9.27:

Question 25:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Own Debentures A/c (8,000×160)

Dr.

 

12,80,000

 

 

   To Bank A/c

 

 

 

12,80,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

7% Debentures A/c

Dr.

 

16,00,000

 

 

   To Own Debentures A/c

 

 

 

12,80,000

 

   To Profit on cancellation of own debentures A/c

 

 

 

3,20,000

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on cancellation of own debentures A/c

Dr.

 

3,20,000

 

 

   To Capital Reserve A/c

 

 

 

3,20,000

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Investment in Own Debentures A/c (1,00,000×10)

Dr.

 

10,00,000

 

 

   To Bank A/c

 

 

 

10,00,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Note: Since no information is provided regarding cancellation, the entry for cancellation of own debentures will not be recorded.

Page No 9.27:

Question 26:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Investment in Own Debentures A/c (1,00,000×10)

Dr.

 

10,00,000

 

 

   To Bank A/c

 

 

 

10,00,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Note: Since no information is provided regarding cancellation, the entry for cancellation of own debentures will not be recorded.

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

30th June

Debentures Interest A/c

Dr.

 

6,000

 

 

   To Bank A/c

 

 

 

6,000

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

1st July

Investment in Own Debentures A/c (400×93)

Dr.

 

37,200

 

 

   To Bank A/c

 

 

 

37,200

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (400×99)

Dr.

 

39,600

 

 

   To Investment in Own Debentures A/c

 

 

 

37,200

 

   To Profit on Sale of own debentures A/c

 

 

 

2,400

 

(Own debentures resold)

 

 

 

 

 

 

 

 

 

 

 

Profit on Sale of own debentures A/c

Dr.

 

2,400

 

 

   To Capital Reserve A/c

 

 

 

2,400

 

(Profit on sale transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Page No 9.27:

Question 27:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

30th June

Debentures Interest A/c

Dr.

 

6,000

 

 

   To Bank A/c

 

 

 

6,000

 

(Interest on debentures paid)

 

 

 

 

 

 

 

 

 

 

1st July

Investment in Own Debentures A/c (400×93)

Dr.

 

37,200

 

 

   To Bank A/c

 

 

 

37,200

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (400×99)

Dr.

 

39,600

 

 

   To Investment in Own Debentures A/c

 

 

 

37,200

 

   To Profit on Sale of own debentures A/c

 

 

 

2,400

 

(Own debentures resold)

 

 

 

 

 

 

 

 

 

 

 

Profit on Sale of own debentures A/c

Dr.

 

2,400

 

 

   To Capital Reserve A/c

 

 

 

2,400

 

(Profit on sale transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Bank A/c (1,80,000×500)

Dr.

 

9,00,00,000

 

 

   To Debenture Application A/c

 

 

 

9,00,00,000

 

(Amount received on issue of 1,80,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

9,00,00,000

 

 

   To 7½ Debentures A/c

 

 

 

9,00,00,000

 

(Allotment of 1,80,000 debentures done)

 

 

 

 

 

 

 

 

 

 

 

Investment in Own Debentures A/c (80,000×485)

Dr.

 

3,88,00,000

 

 

   To Bank A/c

 

 

 

3,88,00,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (80,000×510)

Dr.

 

4,08,00,000

 

 

   To Investment in Own Debentures A/c

 

 

 

3,88,00,000

 

   To Profit on Sale of own debentures A/c

 

 

 

20,00,000

 

(Own debentures resold)

 

 

 

 

 

 

 

 

 

 

 

Profit on Sale of own debentures A/c

Dr.

 

20,00,000

 

 

   To Capital Reserve A/c

 

 

 

20,00,000

 

(Profit on sale transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 



Page No 9.28:

Question 28:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

 

Bank A/c (1,80,000×500)

Dr.

 

9,00,00,000

 

 

   To Debenture Application A/c

 

 

 

9,00,00,000

 

(Amount received on issue of 1,80,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

9,00,00,000

 

 

   To 7½ Debentures A/c

 

 

 

9,00,00,000

 

(Allotment of 1,80,000 debentures done)

 

 

 

 

 

 

 

 

 

 

 

Investment in Own Debentures A/c (80,000×485)

Dr.

 

3,88,00,000

 

 

   To Bank A/c

 

 

 

3,88,00,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Bank A/c (80,000×510)

Dr.

 

4,08,00,000

 

 

   To Investment in Own Debentures A/c

 

 

 

3,88,00,000

 

   To Profit on Sale of own debentures A/c

 

 

 

20,00,000

 

(Own debentures resold)

 

 

 

 

 

 

 

 

 

 

 

Profit on Sale of own debentures A/c

Dr.

 

20,00,000

 

 

   To Capital Reserve A/c

 

 

 

20,00,000

 

(Profit on sale transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

 

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

2011

 

 

 

 

 

Jan 1

Bank A/c (40,000×100)

Dr.

 

40,00,000

 

 

   To Debenture Application A/c

 

 

 

40,00,000

 

(Amount received on issue of 40,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

40,00,000

 

 

   To 9% Debentures A/c

 

 

 

40,00,000

 

(Allotment of 40,000 debentures made)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit and Loss A/c

Dr.

 

12,000

 

 

   To Expenses on Issue of Debentures A/c

 

 

 

12,000

 

(Expenses on issue of debentures written off)

 

 

 

 

2012

 

 

 

 

 

Dec. 31

Debenture’s Interest A/c

Dr.

 

3,60,000

 

 

   To Bank A/c

 

 

 

3,60,000

 

(Debentures Interest paid for the year)

 

 

 

 

 

 

 

 

 

 

 

Own Debentures A/c (2,000×98)

Dr.

 

1,96,000

 

 

   To Bank A/c

 

 

 

1,96,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Own Debentures A/c

Dr.

 

400

 

 

   To Bank A/c

 

 

 

400

 

(Expenses on issue of own debentures)

 

 

 

 

 

 

 

 

 

 

 

9%Debentures A/c

Dr.

 

2,00,000

 

 

   To Own Debentures A/c

 

 

 

1,96,400

 

   To Profit on Cancellation of own debentures A/c

 

 

 

3,600

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on Cancellation of own debentures A/c

Dr.

 

3,600

 

 

   To Capital Reserve A/c

 

 

 

3,600

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

Note: It has been assumed that the company has an adequate amount in Debenture Redemption Reserve; hence, no entry has been passed for the same.

Page No 9.28:

Question 29:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

2011

 

 

 

 

 

Jan 1

Bank A/c (40,000×100)

Dr.

 

40,00,000

 

 

   To Debenture Application A/c

 

 

 

40,00,000

 

(Amount received on issue of 40,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

40,00,000

 

 

   To 9% Debentures A/c

 

 

 

40,00,000

 

(Allotment of 40,000 debentures made)

 

 

 

 

 

 

 

 

 

 

 

Statement of Profit and Loss A/c

Dr.

 

12,000

 

 

   To Expenses on Issue of Debentures A/c

 

 

 

12,000

 

(Expenses on issue of debentures written off)

 

 

 

 

2012

 

 

 

 

 

Dec. 31

Debenture’s Interest A/c

Dr.

 

3,60,000

 

 

   To Bank A/c

 

 

 

3,60,000

 

(Debentures Interest paid for the year)

 

 

 

 

 

 

 

 

 

 

 

Own Debentures A/c (2,000×98)

Dr.

 

1,96,000

 

 

   To Bank A/c

 

 

 

1,96,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

 

Own Debentures A/c

Dr.

 

400

 

 

   To Bank A/c

 

 

 

400

 

(Expenses on issue of own debentures)

 

 

 

 

 

 

 

 

 

 

 

9%Debentures A/c

Dr.

 

2,00,000

 

 

   To Own Debentures A/c

 

 

 

1,96,400

 

   To Profit on Cancellation of own debentures A/c

 

 

 

3,600

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on Cancellation of own debentures A/c

Dr.

 

3,600

 

 

   To Capital Reserve A/c

 

 

 

3,600

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

Note: It has been assumed that the company has an adequate amount in Debenture Redemption Reserve; hence, no entry has been passed for the same.

Answer:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

2005-06

Bank A/c (5,000×100)

Dr.

 

5,00,000

 

 

   To Debenture Application A/c

 

 

 

5,00,000

 

(Amount received on issue of 5,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

5,00,000

 

 

   To 10% Debentures A/c

 

 

 

5,00,000

 

(Allotment of 5,000 debentures done)

 

 

 

 

 

 

 

 

 

 

2013

 

 

 

 

 

Apr. 01

Own Debentures A/c

Dr.

 

48,000

 

 

   To Bank A/c

 

 

 

48,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

Sept 30

Debenture’s Interest A/c

Dr.

 

25,000

 

 

   To Debenture holder’s A/c

 

 

 

22,500

 

   To Investment in Own Debentures A/c

 

 

 

2,500

 

(Interest due on debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture holder’s A/c

Dr.

 

22,500

 

 

   To Bank A/c

 

 

 

22,500

 

(Payment of Interest on debentures)

 

 

 

 

  2014

 

 

 

 

 

Mar. 31

Debenture’s Interest A/c

Dr.

 

25,000

 

 

   To Debenture holder’s A/c

 

 

 

22,500

 

   To Investment in Own Debentures A/c

 

 

 

2,500

 

(Interest due on debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture holder’s A/c

Dr.

 

22,500

 

 

   To Bank A/c

 

 

 

22,500

 

(Payment of Interest on debentures)

 

 

 

 

 

 

 

 

 

 

 

10%Debentures A/c

Dr.

 

50,000

 

 

   To Own Debentures A/c

 

 

 

48,000

 

   To Profit on Cancellation of own debentures A/c

 

 

 

2,000

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on Cancellation of own debentures A/c

Dr.

 

2,000

 

 

   To Capital Reserve A/c

 

 

 

2,000

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

Note: Debenture Interest Account is shown in the Statement of Profit and Loss under the head ‘Finance Costs’ and the ‘Interest on Own Debentures’ is shown under the head ‘Other Income’ in the statement of Profit and Loss.

Page No 9.28:

Question 30:

Journal

 

Date

Particulars

L.F.

Debit

Amount

Rs

Credit Amount

Rs

2005-06

Bank A/c (5,000×100)

Dr.

 

5,00,000

 

 

   To Debenture Application A/c

 

 

 

5,00,000

 

(Amount received on issue of 5,000 debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture Application A/c

Dr.

 

5,00,000

 

 

   To 10% Debentures A/c

 

 

 

5,00,000

 

(Allotment of 5,000 debentures done)

 

 

 

 

 

 

 

 

 

 

2013

 

 

 

 

 

Apr. 01

Own Debentures A/c

Dr.

 

48,000

 

 

   To Bank A/c

 

 

 

48,000

 

(Own debentures purchased)

 

 

 

 

 

 

 

 

 

 

Sept 30

Debenture’s Interest A/c

Dr.

 

25,000

 

 

   To Debenture holder’s A/c

 

 

 

22,500

 

   To Investment in Own Debentures A/c

 

 

 

2,500

 

(Interest due on debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture holder’s A/c

Dr.

 

22,500

 

 

   To Bank A/c

 

 

 

22,500

 

(Payment of Interest on debentures)

 

 

 

 

  2014

 

 

 

 

 

Mar. 31

Debenture’s Interest A/c

Dr.

 

25,000

 

 

   To Debenture holder’s A/c

 

 

 

22,500

 

   To Investment in Own Debentures A/c

 

 

 

2,500

 

(Interest due on debentures)

 

 

 

 

 

 

 

 

 

 

 

Debenture holder’s A/c

Dr.

 

22,500

 

 

   To Bank A/c

 

 

 

22,500

 

(Payment of Interest on debentures)

 

 

 

 

 

 

 

 

 

 

 

10%Debentures A/c

Dr.

 

50,000

 

 

   To Own Debentures A/c

 

 

 

48,000

 

   To Profit on Cancellation of own debentures A/c

 

 

 

2,000

 

(Own debentures cancelled)

 

 

 

 

 

 

 

 

 

 

 

Profit on Cancellation of own debentures A/c

Dr.

 

2,000

 

 

   To Capital Reserve A/c

 

 

 

2,000

 

(Profit on cancellation transferred to capital reserve)

 

 

 

 

 

 

 

 

 

 

Note: Debenture Interest Account is shown in the Statement of Profit and Loss under the head ‘Finance Costs’ and the ‘Interest on Own Debentures’ is shown under the head ‘Other Income’ in the statement of Profit and Loss.

Answer:

Case (i)

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

At the time of Issue

 

 

 

 

Bank A/c

Dr.

 

10,00,000

 

 

To 12% Debenture Application A/c

 

 

10,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

10,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

To 12% Debentures A/c

 

 

10,00,000

 

To Premium on Redemption of Debenture A/c

 

 

1,00,000

 

(20,000 12% Debentures of Rs 50 each Issued at par repayable at 10% premium)

 

 

 

 

 

 

 

 

 

At the time of Redemption

 

 

 

 

12% Debenture A/c

Dr.

 

10,00,000

 

 

Premium on Redemption A/c

Dr.

 

1,00,000

 

 

To Debentureholders’ A/c

 

 

11,00,000

 

(2,000 12% Debentures of Rs 50 each repayable at 10% premium due for redemption)

 

 

 

 

 

 

 

 

 

Debenture holders A/c

Dr.

 

11,00,000

 

 

To Bank A/c

 

 

11,00,000

 

(Payment made to debenture holders)

 

 

 

 

 

 

 

 

Case (ii)

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

At the time of Issue

 

 

 

 

Bank A/c

Dr.

 

11,00,000

 

 

To 12% Debenture Application A/c

 

 

11,00,000

 

(Debenture application money received)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

11,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

2,00,000

 

 

To 12% Debentures A/c

 

 

10,00,000

 

To Securities Premium A/c

 

 

1,00,000

 

To Premium on Redemption A/c

 

 

2,00,000

 

(20,000 12% Debentures of Rs 50 each issued at 10% Premium, repayable at 20% Premium)

 

 

 

 

 

 

 

 

 

At the time of Redemption

 

 

 

 

12% Debenture A/c

Dr.

 

10,00,000

 

 

Premium on Redemption A/c

Dr.

 

2,00,000

 

 

To Debentureholders’ A/c

 

 

12,00,000

 

(2,000 12% Debentures of Rs 50 each due for redemption at a premium of 20%)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

12,00,000

 

 

To Bank A/c

 

 

12,00,000

 

(Amount paid to debentureholders)

 

 

 

 

 

 

 

 

Case (iii)

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

 

At the time of Issue

 

 

 

 

Bank A/c

Dr.

 

10,00,000

 

 

To 12% Debenture Application A/c

Dr.

 

 

10,00,000

 

(Debenture application money received for 20,000 Debenture Rs 50 each)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

5,00,000

 

 

Loss on Issue of Debentures A/c

Dr.

 

1,00,000

 

 

To 12% Debentures A/c

 

 

5,00,000

 

To Premium on Redemption A/c

 

 

1,00,000

 

(10,000 12% Debentures of Rs 50 each issued at par with term redeemable at premium)

 

 

 

 

 

 

 

 

 

12% Debenture Application A/c

Dr.

 

5,00,000

 

 

To 12% Debentures A/c

 

 

5,00,000

 

(10,000 12% Debenture of Rs 50 each issued at par)

 

 

 

 

 

 

 

 

 

At the time of Redemption

 

 

 

 

12% Debentures A/c

Dr.

 

5,00,000

 

 

To Debentureholders’ A/c

 

 

5,00,000

 

(10,000 Debentures of Rs 50 each due for redemption)

 

 

 

 

 

 

 

 

 

12% Debentureholders; A/c

Dr.

 

5,00,000

 

 

To Bank A/c

 

 

5,00,000

 

(Payment made in cash to 50% debentureholders)

 

 

 

 

 

 

 

 

 

12% Debentures A/c

Dr.

 

5,00,000

 

 

Premium on Redemption A/c

Dr.

 

1,00,000

 

 

To Debentureholders’ A/c

 

 

6,00,000

 

(10,000 12% Debentures of Rs 100 each due for redemption)

 

 

 

 

 

 

 

 

 

Debentureholders’ A/c

Dr.

 

6,00,000

 

 

To Debentures A/c

 

 

6,00,000

 

(New Debenture issued to the holders of 10,000 12% Debentures)

 

 

 

 

 

 

 

 

 



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