Answer:
JOURNAL
Calculation of DRR \[9,00,000\times \frac{25}{100}=Rs.\,2,25,000\] Calculation of Debenture Redemption Investment \[9,00,000\times \frac{15}{100}=Rs.\,1,35,000\] Date Particulars LF Amt (Dr) Amt (Cr) 2016 Mar 31 Surplus, i.e. Balance in Statement of Profit and Loss Dr 2,25,000 To Debenture Redemption Reserve A/c 2,25,000 (Being the amount equal to 25% of the debentures transferred to DRR) Apr 30 Debenture Redemption Investment A/c Dr 1,35,000 To Bank A/c 1,35,000 (Being the amount equal to 15% of value of debentures to be redeemed invested) 2017 Mar 31 Bank A/c Dr 1,35,000 To Debenture Redemption Investment A/c 1,35,000 (Being the investment encashed) Mar 31 8% Debentures A/c Dr 9,00,000 Premium on Redemption of Debentures A/c Dr 45,000 To Debenture holders' A/c 9,45,000 (Being the amount due on redemption) Mar 31 Debenture holders' A/c Dr 9,45,000 To Bank A/c 9,45,000 (Being the payment made to the debenture holders') Mar 31 Debenture Redemption Reserve A/c Dr 2,25,000 To General Reserve A/c 2,25,000 (Being the transfer of balance of DRR to general reserve)
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