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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Pass the necessary Journal entries relating to the issue of debentures and to write off discount/loss on issue of debentures in the books of Srijan Ltd. in the following cases: (i) 900, 6% Debentures of ₹1,000 each are issued at a 5% discount and redeemable at par. Balance in Securities Premium Account is ₹50,000. (ii) 700, 8% Debentures of ₹1,000 each are issued at a 10% discount and redeemable at a premium of 10%. Balance in Securities Premium Account is ₹1,00,000. (CBSE 2024)
JOURNAL (Books of Srijan Ltd.)
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| (i) | Bank A/c Dr. | 8,55,000 | ||
| To Debentures Application and Allotment A/c | 8,55,000 | |||
| (Application money received for 900; 6% Debentures of ₹1,000 each issued at a 5% discount) | ||||
| Debentures Application and Allotment A/c Dr. | 8,55,000 | |||
| Discount on Issue of Debentures A/c Dr. | 45,000 | |||
| To 6% Debentures A/c | 9,00,000 | |||
| (Application money transferred to Debentures Account) | ||||
| Securities Premium A/c Dr. | 45,000 | |||
| To Discount on Issue of Debentures A/c | 45,000 | |||
| (Discount on issue of debentures written off) | ||||
| (ii) | Bank A/c Dr. | 6,30,000 | ||
| To Debentures Application and Allotment A/c | 6,30,000 | |||
| (Application money received for 700; 8% debentures) | ||||
| Debentures Application and Allotment A/c Dr. | 6,30,000 | |||
| Loss on Issue of Debentures A/c Dr. | 1,40,000 | |||
| To 8% Debentures A/c | 7,00,000 | |||
| To Premium on Redemption of Debentures A/c | 70,000 | |||
| (700; 8% Debentures of ₹1,000 each issued at a 10% discount, redeemable at a 10% premium) | ||||
| Securities Premium A/c Dr. | 1,00,000 | |||
| Statement of Profit and Loss A/c Dr. | 40,000 | |||
| To Loss on Issue of Debentures A/c | 1,40,000 | |||
| (Loss 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.57 - 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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