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Question -

A. Ltd. issued 90,00,000, 9% Debenture of ₹ 50 each at a discount of 8%, redeemable at par any time after 9 years. Record necessary entries in the books of A. Ltd.



Answer -

Books of A. Ltd.

 

Journal

 

Date

Particulars

L.F.

Debit

Amount

Credit

Amount

Bank A/c

Dr.

41,40,00,000

Discount on Issue of Debenture A/c

Dr.

3,60,00,000

To 9% Debenture A/c

45,00,00,000

(Money received for 90,00,000 9% Debentures

@ ₹ 50 each at discount of 8%)

Alternative Method:

 

Bank A/c

Dr.

41,40,00,000

To 9% Debentures Application A/c

41,40,00,000

(Debenture Application money received  @ ₹ 46 each

on 90,00,000  9% Debentures)

9% Debentures Application A/c

Dr.

41,40,00,000

Discount on issue of Debentures A/c

Dr.

3,60,00,000

To 9% Debenture A/c

4,50,00,000

(9% Debentures application money transferred to

9% Debenture Account)

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