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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Grown Ltd. issued 500, 10% Debentures of ₹1,000 each, credited as fully paid-up, to the promoters for their services in incorporating the company. It also issued 100, 10% Debentures of ₹1,000 each, credited as fully paid-up, to the underwriters towards their commission. Pass the Journal entries.
JOURNAL (Books of Grown Ltd.)
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| Incorporation Expenses A/c Dr. | 5,00,000 | |||
| To Promoters A/c | 5,00,000 | |||
| (Amount due to promoters for their services) | ||||
| Promoters A/c Dr. | 5,00,000 | |||
| To 10% Debentures A/c (500 × ₹1,000) | 5,00,000 | |||
| (500; 10% debentures issued to the promoters) | ||||
| Underwriting Commission A/c Dr. | 1,00,000 | |||
| To Underwriters A/c | 1,00,000 | |||
| (Amount due to underwriters for their services) | ||||
| Underwriters A/c Dr. | 1,00,000 | |||
| To 10% Debentures A/c (100 × ₹1,000) | 1,00,000 | |||
| (100; 10% debentures issued to the underwriters) | ||||
| Statement of Profit and Loss A/c Dr. | 6,00,000 | |||
| To Incorporation Expenses A/c | 5,00,000 | |||
| To Underwriting Commission A/c | 1,00,000 | |||
| (Expenses transferred to the Statement of Profit and Loss at the end of the year) |
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 "T.S. Grewal Class 12 Vol 2 Chapter 2 Q.27 - Issue of Debentures", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 2 - 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.
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