CBSE 2025, Compartment, Set 1

Question

Astha Ltd. took over assets of ₹20,00,000 and took over liabilities of ₹1,00,000 of Nabha Ltd. for a purchase consideration of ₹18,00,000. Astha Ltd. paid half of the amount of purchase consideration through a bank draft and the balance amount was settled by issuing 12% Debentures of ₹100 each at a discount of 10% in favour of Nabha Ltd. Pass necessary journal entries for the above transactions in the books of Astha Ltd.

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The correct answer is Subjective. **Journal Entries in the books of Astha Ltd.** | Date | Particulars | L.F. | Dr. Amount (₹) | Cr. Amount (₹) | |---|---|---|---|---| | (i) | Sundry Assets A/c Dr. To Sundry Liabilities A/c To Nabha Ltd. To Capital Reserve (Bal. fig.) *(Assets and liabilities of Nabha Ltd. taken over)* | | 20,00,000 | 1,00,000 18,00,000 1,00,000 | | (ii) | Nabha Ltd. Dr. Discount on Issue of Debentures A/c Dr. To Bank A/c To 12% Debentures A/c *(Issue of 10,000 debentures of ₹100 at 10% discount and payment via bank draft)* | | 18,00,000 1,00,000 | 9,00,000 10,00,000 | **Working Notes:** 1. Capital Reserve = Assets - Liabilities - Purchase Consideration $ = 20,00,000 - 1,00,000 - 18,00,000 = ₹1,00,000$. 2. Payment = ₹18,00,000. Bank draft = ₹9,00,000. Amount settled via debentures = ₹9,00,000. Issue Price = 100 - 10 = ₹90. No. of debentures issued = $9,00,000 / 90 = 10,000$ debentures.

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Accountancy > Accounting For Companies > Issue Of Debentures

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