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Question 4 Chapter 9 of +2-Part-1
4. (Issue at Premium/Journal/Balance Sheet) Aurangabad Mills Ltd. Issued Rs. 5,00,000,6% Debentures of Rs. 500 each at a premium of 5%. The amount was payable as follows:
On application Rs. 100
On allotment Rs. 250(including premium)
On first call Rs. 175.
The company received applications for 1,020 debentures and allotment being made to the applicants of 1000 shares. Excess amount was refunded.
Give journal entries and show the balance sheet.
Journal
| Date | Particulars |
L.F. | Debit | Credit | |
|---|---|---|---|---|---|
| Bank A/c | Dr. | 1,02,000 | |||
| To Debenture Application A/c | 1,02,000 | ||||
| (Being app. Money received ) | |||||
| Debenture Application A/c | Dr. | 1,02,000 | |||
| To 6% Debenture A/c | 1,00,000 | ||||
| To Bank A/c | 2,000 | ||||
| (Being transfer of app. Money on 1,000 debentures & refund of amount on 20 app.) | |||||
| Debenture Allotment A/c | Dr. | 2,50,000 | |||
| To 6% Debenture A/c | 2,25,000 | ||||
| To Securities Premium Reserve A/c | 25,000 | ||||
| (Being allotment amount transferred to debentures & premium A/c) | |||||
| Bank A/c | Dr. | 2,50,000 | |||
| To Debenture Allotment A/c | 2,50,000 | ||||
| (Being allotment money received ) | |||||
| Debenture First & Final Call A/c (1,000 X 30) | Dr. | 1,75,000 | |||
| To 6% Debenture A/c | 1,75,000 | ||||
| (Being first & final call money due ) | |||||
| Bank A/c | Dr. | 1,75,000 | |||
| To Debenture first & final call A/c | 1,75,000 | ||||
| (Being first & final call money received ) | |||||
Aurangabad Mills Ltd. Balance Sheet Schedule III (Part I)
| Sr. No. | Particulars |
Note No. | FIG. RELATING TO CURRENT REPORTNG PERIOD | FIG. RELATING TO PREVIOUS REPORTNG PERIOD | |
|---|---|---|---|---|---|
| I | Equity & Liability | ||||
| Shareholders fund | |||||
| Reserve & Surplus | 1 | 25,000 | |||
| Non current Liabilities | 2 | 5,00,000 | |||
| Current Liabilities | |||||
| Total | 5,25,000 | ||||
| II | Assets | ||||
| Non -Current Assets |
|||||
| Current Assets |
|||||
| Cash & Cash equivalent |
|||||
| Cash at bank |
5,25,000 | ||||
| Total | 5,25,000 | ||||
Note 1:- Reserve & Surplus
| Particulars |
Current year | Previous year | |
|---|---|---|---|
| Secruity Premium | 25,000 | ||
| Total | 25,000 | ||
Note 2 :- Non – Current Liabilities
| Particulars |
Current year | Previous year | |
|---|---|---|---|
| 5 % Debentures | |||
| 1,000 Debentures of ₹ 500 each | 5,00,000 | ||
| Total | 5,00,000 | ||
It all about Question 4 Chapter 9 of +2-Part-1, If you have any problem please comment below.
https://tutorstips.com/issue-of-debentures-from-the-point-of-view-of-redemption/
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 4 Chapter 9 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. 9 - Company Accounts (Issue of Debentures).
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.
You can take our custom-built interactive practice quiz directly on this page to test your understanding of "Question 4 Chapter 9 of +2-Part-1 - USHA Publication 12 Class Part - 1" instantly.
