CBSE 2025, Set 2

Question

Pass necessary journal entries for issue of debentures for the following transactions:
(i) L Ltd. issued 5,000, 8% debentures of ₹ 100 each at a discount of 5%, redeemable at a premium of 10%.
(ii) M Ltd. issued 4,000, 9% debentures of ₹ 100 each at a premium of 10%, redeemable at a premium of 5%.

Edvaya · Accepted Answer

The correct answer is Subjective. **(i) Books of L Ltd.** | Date | Particulars | L.F. | Dr. Amount (₹) | Cr. Amount (₹) | |---|---|---|---|---| | | Bank A/c ...Dr.     To Debenture Application and Allotment A/c (Debenture application money received) | | 4,75,000 | 4,75,000 | | | Debenture Application and Allotment A/c ...Dr. Loss on Issue of Debentures A/c ...Dr.     To 8% Debentures A/c     To Premium on Redemption of Debentures A/c (Debenture app money transferred to debentures and premium on redemption provided. Loss = 25k discount + 50k premium) | | 4,75,000 75,000 | 5,00,000 50,000 | **(ii) Books of M Ltd.** | Date | Particulars | L.F. | Dr. Amount (₹) | Cr. Amount (₹) | |---|---|---|---|---| | | Bank A/c ...Dr.     To Debenture Application and Allotment A/c (Debenture application money received) | | 4,40,000 | 4,40,000 | | | Debenture Application and Allotment A/c ...Dr. Loss on Issue of Debentures A/c ...Dr.     To 9% Debentures A/c     To Securities Premium A/c     To Premium on Redemption of Debentures A/c (Debenture app money transferred and premium on redemption provided) | | 4,40,000 20,000 | 4,00,000 40,000 20,000 |

Edvaya Target

Edvaya Aspire

Take a Free Mock Test

Target Subjects

Aspire Subjects

Subject Mastery

Accountancy > Accounting For Companies > Issue Of Debentures

Keep Practicing

Edvaya Target

Current Question

Community Stats

Track Your Progress

Quick Actions

We Value Your Privacy