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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Garvit Ltd. invited applications for issuing 3,000, 11% Debentures of ₹100 each at a discount of 6%. The full amount was payable on application. Applications were received for 3,600 debentures. Applications for 600 debentures were rejected and the application money was refunded. Debentures were allotted to the remaining applicants. Pass the necessary Journal entries for the above transactions, including writing off the Discount on Issue of Debentures, in the books of Garvit Ltd.
JOURNAL (Books of Garvit Ltd.)
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| Bank A/c (3,600 × ₹94) Dr. | 3,38,400 | |||
| To Debentures Application and Allotment A/c | 3,38,400 | |||
| (Application money received on 11% Debentures issued at a 6% discount) | ||||
| Debentures Application and Allotment A/c Dr. | 3,38,400 | |||
| Discount on Issue of Debentures A/c (3,000 × ₹6) Dr. | 18,000 | |||
| To 11% Debentures A/c (3,000 × ₹100) | 3,00,000 | |||
| To Bank A/c (600 × ₹94) | 56,400 | |||
| (Application and allotment money adjusted; 600 rejected applications refunded) | ||||
| Statement of Profit and Loss A/c Dr. | 18,000 | |||
| To Discount on Issue of Debentures A/c | 18,000 | |||
| (Discount on issue of debentures written off) |
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.53 - 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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