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Question 21 Chapter 10 of Class 12 Part – 2 – 2024
21. (Redeemable by Drawing a lots) A listed company has on 1-4-16 Rs. 4,00,000 10% Debentures of 100 each. These are redeemable by drawing of lots at 5% premium.
At the time of issue of these debenture, premium was not credited.
On 30-6-16 appeared company redeemed 700 debentures at premium. The following balances.
| Securities Premium | ₹ 6,000 |
| Reserve Profit & Loss | ₹ 2,50,000 |
| Bank Balance | ₹ 60,000 |
Bank loan to the extent necessary for redemption was taken by the company.
Pass necessary journal entries Ignore interest on debentures.
We are providing a solution of Question 21 Chapter 10 of Class 12 Part – 2 Usha Publication in two formats. one is in Video format and another is in article format. Check out both formats as follows:
The video consists solution of question numbers from 19 to 21 Chapter no. 10 class 12 of Usha publication. To check the direct solution of question no. 21 from the following video by using time stamps of the video.
Journal
| Date | Particulars |
L.F. | Debit ₹ | Credit ₹ | |
|---|---|---|---|---|---|
| 30-4-14 | Debenture Redemption Investment A/c | Dr. | 10,500 | ||
| To Bank A/c | 10,500 | ||||
| (15% of 70,00 invested in debentures redeemable investment) | |||||
| 30-6-14 | 10% Debenture A/c | Dr. | 70,000 | ||
| Premium on Redemption A/c | Dr. | 3,500 | |||
| To Debentures holders A/c | 73,500 | ||||
| (Being amount due o 100 debentures) | |||||
| Securities Premium A/c | Dr. | 3,500 | |||
| To Premium Redemption Reserve A/c | 3,500 | ||||
| (Being premium on redemption created out of securities premium) | |||||
| Surplus in Statement of Profit & loss | Dr. | 1,00,000 | |||
| To Debenture Redemption Reserve A/c | 1,00,000 | ||||
| (Being 25% amount of 4,00,000 debentures created as DRR) | |||||
| Bank A/c | Dr. | 13,500 | |||
| To Bank Loan A/c | 13,500 | ||||
| (Being bank loan 73500-60000=13500 taken) | |||||
| Debentures Holders A/c | Dr. | 73,500 | |||
| To Bank A/c | 73,500 | ||||
| (Being amount paid to debentures holders) | |||||
Note: Premium on Redemption was not credited at the time of issue of debentures ,therefore, the same is created out or securities premium.
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.
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