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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Kitply Ltd. issued ₹2,00,000, 10% Debentures at a discount of 5%. The terms of issue provide for repayment at the end of 4 years. Kitply Ltd. has a balance of ₹5,00,000 in Securities Premium Reserve. Pass the Journal entries for the issue of debentures and for writing off the discount.
JOURNAL (Books of Kitply Ltd.)
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| 1 April | Bank A/c Dr. | 1,90,000 | ||
| To 10% Debenture Application A/c | 1,90,000 | |||
| (Debenture application money received at a 5% discount) | ||||
| 1 April | 10% Debenture Application A/c Dr. | 1,90,000 | ||
| Discount on Issue of Debentures A/c Dr. | 10,000 | |||
| To 10% Debentures A/c | 2,00,000 | |||
| (₹2,00,000; 10% Debentures issued at a 5% discount, repayable at the end of 4 years) | ||||
| 31 March | Securities Premium Reserve A/c Dr. | 10,000 | ||
| To Discount on Issue of Debentures A/c | 10,000 | |||
| (Discount on issue of debentures written off against Securities Premium Reserve) |
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.47 - 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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