Pass necessary journal entries for issue of debentures’ for the following
(i) Jain Ltd. issued 750,12% Debentures of Rs.100 each at a discount of 10%redeemable at a premium of 5%.
(ii) Sohan Ltd. issued 800, 9% Debentures of Rs.100 each at a premium of Rs.20 per Debenture redeemable at a premium of Rs.10 per Debenture
In repoase to your first query,
In response to your second query,
| Books of Ain Ltd. | ||||||
| Journal | ||||||
| Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
| Bank A/c | Dr. | 67,500 | ||||
| To Debenture Application A/c | 67,500 | |||||
| (750 12% Debentures of 100 each issued at discount of 10%) | ||||||
| Debenture Application A/c | Dr. | 67,500 | ||||
| Discount on Issue of Debentures A/c | Dr. | 7,500 | ||||
| Loss on Issue of Debentures A/c | Dr. | 3,750 | ||||
| To 12% Debenture A/c | 75,000 | |||||
| To Premium on Redemption of Debentures A/c | 3,750 | |||||
| (Debenture application transferred to 12% Debenture Account) | ||||||
In response to your second query,
| Books of Sohan Ltd. | ||||||
| Journal | ||||||
| Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
| Bank A/c | Dr. | 96,000 | ||||
| To Debenture Application A/c | 96,000 | |||||
| (800 9% Debentures of Rs 100 each issued at premium of 20%) | ||||||
| Debenture Application A/c | Dr. | 96,000 | ||||
| Loss on Issue of Debentures A/c | Dr. | 8,000 | ||||
| To 12% Debenture A/c | 80,000 | |||||
| To Securities Premium A/c | 16,000 | |||||
| To Premium on Redemption of Debentures A/c | 8,000 | |||||
| (Debenture application transferred to 9% Debenture Account) | ||||||