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Question 7 Chapter 10 of +2-Part-1
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Table of Contents
7. (Redemption in Lumpsum) Y Ltd., a listed co., redeemed Rs. 50,00,000, 8% Debentures at a premium of 10 % 31st March 2017. Pass necessary Journal entries for the redemption of debentures.
The solution of Question 7 Chapter 10 of +2 Part-1: –
Y Ltd. Journal | |||||
Date | Particulars | L.F. | Debit ₹ | Credit ₹ | |
30-4-16 | Debenture Redemption Investment A/c | Dr. | 90,000 | ||
To Bank A/c | 90,000 | ||||
(Being the 15 % investment on April 30 in year of redemption) | |||||
31-3-17 | Bank A/c | Dr. | 90,000 | ||
To Debenture Redemption Investment | 90,000 | ||||
(Being investment encashed) | |||||
30-4-17 | Surplus in Statement of Profit & loss | Dr. | 90,000 | ||
To Debenture Redemption Investment A/c | 90,000 | ||||
(Being profit transferred to DRR equal to 100 % of N.V. of debentures ) | |||||
30-4-17 | 8% Debenture A/c | Dr. | 50,00,000 | ||
Premium on Redemption A/c | Dr. | 5,00,000 | |||
To Debenture holders A/c | 55,00,000 | ||||
(Being debentures redeemable at 10% premium ) | |||||
30-4-17 | Debenture Holder A/c | Dr. | 55,00,000 | ||
To Bank A/c | 55,00,000 | ||||
(Being debentures holders paid off ) | |||||
30-4-17 | Debenture Redemption Investment A/c | Dr. | 50,00,000 | ||
To General Reserve A/c | 50,00,000 | ||||
(Being DRR transferred ) |
Note: 100% DRR created because redemption is out of profit as mentioned in question
It all about Question 7 Chapter 10 of +2-Part-1, If you have any problem please comment below.
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Redemption of Debentures – explained with an example
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
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