MONU ltd issued 25,000, 10% debenture 0f RS. 100 each .give journal entries
(1). the debenture were issued at a premium of 20%
(2). the debenture were issued as a collateral security to bank against a loan of RS. 20,00,000.
(30. the debenture were issed to a supplier of machinery costing RS. 28,00,000 as his full and final payment.
Books of Monu Ltd Journal | |||||
Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) | |
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(1) | Bank A/c | Dr. |
| 30,00,000 |
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| To Debenture Application A/c |
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| 30,00,000 | |
| (Being application money received) |
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| Debenture Application A/c | Dr. |
| 30,00,000 |
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| To 10% Debentures |
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| 25,00,000 | |
| To Securities Premium A/c |
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| 5,00,000 | |
| (Being 25,000 10% Debentures issued of Rs 100 each at a premium of Rs 20 each) |
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(2) | No entry is to be recorded at the time of issue Of such debentures as Collateral Security |
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(3) | Machinery A/c | Dr. |
| 28,00,000 |
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| To Vendor |
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| 25,00,000 | |
| To Capital Reserve A/c (Balancing Figure)** |
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| 3,00,000 | |
| (Being Machinery purchased costing Rs 28,00,000 from Vendor) |
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| Vendor | Dr. |
| 25,00,000 |
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| To 10% Debentures A/c |
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| 25,00,000 | |
| (Being debentures issued for payment) |
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** Balancing Figure of Rs 3,00,000 is transfered to Capital Reserve as this is of Capital nature(short payment against purchase of Capital Asset). Also this is a heavy amount, so it cannot be transfered to Discount Received Account.