Question 28 Chapter 9 of +2-Part-1 – USHA Publication 12 Class Part – 1

Question 28 Chapter 9 of +2-Part-1

28. (Different cases of Issue of Debentures) Give journal entries in each of the following at Rs. 100.alternative cases assuming the face value of a debenture being Rs. 100.
A 12% debenture issued at Rs. 100 repayable at Rs. 100.
(b) A 12% debenture issued at Rs. 95 repayable at Rs. 100.
(c) A 12% debenture issued at Rs. 105 repayable at Rs. 100.
(d) A 12% debenture issued at Rs. 100 repayable at Rs. 105.
(e) A 12% debenture issued at Rs. 95 repayable at Rs.105.
(f) A 12% debenture issued at Rs. 105 repayable at Rs 110.

The solution of Question 28 Chapter 9 of +2 Part-1: –

Journal
Date	Particulars		L.F.	Debit ₹	Credit ₹
	Bank A/c	Dr.		100
	To Debenture Application & allotment A/c				100
	(Being receipt of debenture money received)
	Debenture Application & Allotment A/c	Dr.		100
	To 12% Debenture A/c				100
	(Being issue of debentures at par)
	Bank A/c	Dr.		95
	To Debenture Application & Allotment A/c				95
	(Being receipt debentures money )
	Debenture Application & Allotment A/c	Dr.		95
	Discount on issue of Debentures A/c	Dr.		5
	To 10% Debenture A/c				100
	(Being issue of debentures at par redeemable at 10 % premium)
	Bank A/c	Dr.		105
	To Debenture Application & Allotment A/c				105
	(Being receipt debentures app. Money)
	Debenture Application & Allotment A/c	Dr.		105
	To 12% Debenture A/c				100
	To Premium on Redemption of Debentures A/c				5
	(Being issue of debentures at discount repayable at premium )
	Bank A/c	Dr.		100
	To Debenture Application & Allotment A/c				100
	(Being receipt debentures app. Money )
	Debenture Application & Allotment A/c	Dr.		100
	Loss on issue of Debentures A/c	Dr.		5
	To 12% Debenture A/c				100
	To Premium on redemption of debentures A/c				5
	(Being the issue of debentures at par but redeemable at 5% prepium)
	Bank A/c	Dr.		95
	To Debenture Application & Allotment A/c				95
	(Being the receipt of Debenture Application Money)
	Debenture Application & Allotment A/c	Dr.		95
	Loss on issue of Debentures A/c	Dr.		10
	To 12% Debenture A/c				100
	To Premium on redemption of debentures A/c				5
	(Being issue of debentures at premium redeemable at par)
	Bank A/c	Dr.		105
	To Debenture Application & Allotment A/c				105
	(Being subscription amount received )
	Debenture Application & Allotment A/c	Dr.		105
	Loss on issue of Debentures A/c	Dr.		10
	To 12% Debenture A/c				100
	To Securities Premium Reserve A/c				5
	To Premium on redemption of debentures A/c				10
	(Being issue of debentures at 5 % discount which are redeemable at 10% premium )

Note : According to prudence & realisation concepts the latter discount (which id to be materialize on redemption ) being an unrealised gain should not be taken into account at the tom od issue & allotment of debentures.

It all about Question 28 Chapter 9 of +2-Part-1, If you have any problem please comment below.

Issue of Debentures from the point of view of Redemption

You can also Check out the solved question of other Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

• Chapter No. 1 – Accounting Not for Profit Organisations
• Chapter No. 2 – Partnership Accounts – I (Introduction)
• Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
• Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)
• Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
• Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
• Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
• Chapter No. 8 – Company Accounts (Share Capital)
• Chapter No. 9 – Company Accounts (Issue of Debentures)
• Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

• Chapter No. 1 – Financial Statements of a Company
• Chapter No. 2 – Financial Statement Analysis
• Chapter No. 3 –  Tools of Financial Statement Analysis- Comparative and Common Size
• Chapter No. 4 – Ratio Analysis
• Chapter No. 5 – Cash Flow Statement