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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
On 1st June, 2024, R Energy Ltd. issued 10,000, 7% Debentures of ₹100 each at a discount of 10%, redeemable at a premium of 10% at the end of five years. All the debentures were subscribed and allotment was made. Prepare the Balance Sheet (extract) as at 31st March, 2025.
R Energy Ltd. Balance Sheet (Extract) as at 31st March, 2025
| Particulars | Note No. | ₹ |
|---|---|---|
| I. Equity and Liabilities | ||
| 1. Shareholders’ Funds — Reserves and Surplus | 3 | (2,00,000) |
| 2. Non-Current Liabilities | ||
| a. Long-Term Borrowings | 1 | 10,00,000 |
| b. Other Long-Term Liabilities | 2 | 1,00,000 |
| Total | 9,00,000 | |
| II. Assets | ||
| Current Assets — Cash and Cash Equivalents | 4 | 9,00,000 |
| Total | 9,00,000 |
NOTES TO ACCOUNTS
| Note No. | Particulars | ₹ |
|---|---|---|
| 1 | Long-Term Borrowings — 10,000, 7% Debentures of ₹100 each | 10,00,000 |
| 2 | Other Long-Term Liabilities — Premium on Redemption of Debentures | 1,00,000 |
| 3 | Reserves and Surplus | |
| Statement of Profit and Loss | — | |
| Less: Loss on Issue of Debentures (unamortised) | (2,00,000) | |
| Total | (2,00,000) | |
| 4 | Cash and Cash Equivalents — 10,000 debentures × ₹90 each | 9,00,000 |
Working Note: Loss on Issue of Debentures = Discount on issue (10,000 × ₹10 = ₹1,00,000) + Premium on redemption (10,000 × ₹10 = ₹1,00,000) = ₹2,00,000, none of which has yet been written off as at 31st March, 2025.
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.54 - 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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