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Question 10 Chapter 10 of +2-Part-1
10. (Partial redemption/Premium on redemption) On 31 May 2017, a company redeemed its 1200 9% Debentures of Rs, 100 each at 5% premium out of the total 6,000 debentures. Debenture Redemption Reserve stood at Rs. 1,10,000. Premium on redemption was existing Company Accounts (Redemption of Debentures) Rs. 30,000. You are required to pass journal entries
Y Ltd. Journal
| Date | Particulars |
L.F. | Debit ₹ | Credit ₹ | |
|---|---|---|---|---|---|
| Apr.30,17 | Debenture Redemption Investment A/c | Dr. | 90,000 | ||
| To Bank A/c | 90,000 | ||||
| (Being DRI made @ 15 % on Rs. 6,00,000) | |||||
| May 31 | Statement of Profit & loss | Dr. | 40,000 | ||
| To Debenture Redemption Reserve A/c | 40,000 | ||||
| (Being DRR created 25% on Rs. 6,00,000 Less : Rs. 1,10,000) | |||||
| 9 % Debenture A/c | Dr. | 1,20,000 | |||
| Premium on Redemption of Debentures A/c | 6,000 | ||||
| To Bank A/c | 1,26,000 | ||||
| (Being amount due) | |||||
| Debenture holders A/c | Dr. | 1,26,000 | |||
| To Bank A/c | 1,26,000 | ||||
| (Being amount paid to debentures holders) | |||||
Note: DRI will be realised after the redemption of all debentures.
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Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "Question 10 Chapter 10 of +2-Part-1 - USHA Publication 12 Class Part - 1", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter No. 10 - Company Accounts – Redemption of Debenture - Usha Publication.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
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