✓ Board-verified
Accountancy · 2025 · 4 marks
CBSE 2025 · Region 7 · Set 1 · Q21
Pass necessary journal entries for the issue of debentures in the books of NK Ltd. for the following transactions : (i) Issued $\displaystyle 500$, $\displaystyle 9$% Debentures of i $\displaystyle 100$ each at $\displaystyle 10$% discount, redeemable at a premium of $\displaystyle 10$% after $\displaystyle 5$ years. (ii) Issued $\displaystyle 400$, $\displaystyle 9$% Debentures of $\displaystyle 100$ each at $\displaystyle 5$% discount, redeemable at par after $\displaystyle 5$ years.
Marking-scheme solution
In the books of NK Ltd.
Journal
Date Particulars L.F Dr. Cr.
Amount Amount
(₹) (₹)
(i)Bank A/c Dr. $\displaystyle 45,000$
To Debenture Application &Allotment A/c $\displaystyle 45,000$
(Application money received on $\displaystyle 500$ ,$\displaystyle 9$% Debentures)
Debenture Application &Allotment A/c Dr. $\displaystyle 45,000$
Loss on issue of Debentures A/c Dr. $\displaystyle 10,000$
To $\displaystyle 9$% Debentures A/c $\displaystyle 50,000$
To Premium on redemption of Debentures A/c $\displaystyle 5,000$
(Debentures issued at $\displaystyle 10$% discount, redeemable at $\displaystyle 10$%
premium )
Or
Debenture Application &Allotment A/c Dr. $\displaystyle 45,000$
Loss on issue of Debentures A/c Dr.
$\displaystyle 5,000$
Discount on issue of Debentures A/c Dr.
$\displaystyle 5,000$
To $\displaystyle 9$% Debentures A/c
$\displaystyle 50,000$
To
Premium on redemption of Debentures A/c $\displaystyle 5,000$
(Debentures issued at $\displaystyle 10$% discount, redeemable at $\displaystyle 10$%
premium )
(ii)
Bank A/c Dr. $\displaystyle 38,000$
To Debenture Application &Allotment A/c $\displaystyle 38,000$
(Application money received on $\displaystyle 400$ ,$\displaystyle 9$% Debentures)
Debenture Application &Allotment A/c Dr.
Discount on issue of Debentures A/c Dr. $\displaystyle 38,000$
To $\displaystyle 9$% Debentures A/c $\displaystyle 2,000$
(Debentures issued at $\displaystyle 5$% discount, redeemable at par) $\displaystyle 40,000$
More from Issue and Redemption of Debentures
- Maharaja Ltd. took over assets of ₹ 15,00,000 and liabilities of ₹ 2,00,000 of Dolphin Ltd. for an agreed…2024
- Debentures which can be transferred by way of delivery and the company does not keep any record of the…2025
- Sinco Ltd. purchased assets of the book value of ₹ 1,98,000 from Dixon Ltd. It was agreed that the purchase…2023
- On 1st April, 2022, Mega Ltd. issued 30,000, 10% Debentures of ₹ 100 each at a discount of 10%. The total…2024
- Satnam Ltd. purchased Building worth ₹ 5,00,000, Plant worth ₹ 4,60,000 and Furniture worth ₹ 2,20,000 from…2022
- Shivalik Ltd. issued 7% debentures of 2 100 each at a discount of 5% on 1st April, 2023. Discount on issue of…2025
- The debentures which do not carry a specific rate of interest are called:2024
- Debentures in respect of which all details including names, addresses and particulars of holding of the…2025
CBSE Class 12 Accountancy past-paper question from the 2025board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.