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Question
Pass necessary Journal Entries for the following transactions in the books of Sudarshan Ltd.
(i) Redeemed 750, 12% Debentures of Rs 75 each by converting into Equity Shares of Rs 100 each. The Equity Shares were issued at a discount of 10%.
(ii) Converted 550, 12% Debentures of Rs 1,000 each into New 13% Debentures of Rs 100 each.
The New Debentures were issued at a premium of 10%.
Solution
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Books of Sudarshan Ltd. Journal |
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Date |
Particulars |
Debit Amount Rs |
Credit Amount Rs |
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|
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12% Debentures A/c |
Dr. |
56,250 |
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|
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To Debentures holders A/c |
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56,250 |
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(Debentures due to debentures holders) |
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Debenture holders A/c |
Dr. |
56,250 |
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Discount on issue of shares A/c |
Dr. |
6,250 |
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To Equity share capital A |
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62,500 |
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(Equity share of Rs 100 each issued at discount to debentures holders) |
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`"No. of equity Share Issued" ="Amount Payble" /"(Face Value-Discount Per Share )"`
=`56250/90`
=`625` Shares
(ii)
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Books of Sudarshan Ltd. |
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Date |
Particulars |
Debit Amount Rs |
Credit Amount Rs |
|
|
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12% Debentures A/c |
Dr. |
5,50,000 |
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|
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To Debenture holders A/c |
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5,50,000 |
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(Debentures due to debenture holders) |
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Debenture holders A/c |
Dr. |
5,50,000 |
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To 13% Debentures A/c |
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5,00,000 |
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To Securities Premium A/c |
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50,000 |
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(13% Debentures of Rs 100 each issued at 10% premium to debenture holders) |
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`"No.of 13% Debentures Issued"= "Amount Payble"/"(Face Value+Permium) Per debenture"`
=`(5,50,000)/110`
=`5,000 " Debenture"`
APPEARS IN
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The following balances have been extracted from the books of Vanity Ltd. as at 31st March, 2017:
Trial Balance as at 31st March, 2017
| Particulars | Debit | Credit |
| Equity Share Capital (5,000 shares of ` 100 each fully paid) | 5,00,000 | |
| Fixed Assets | 7,30,000 | |
| Reverses and Surplus | 2,00,000 | |
| Inventories | 50,000 | |
| Cash and Bank Balances | 1,70,000 | |
| Creditors | 40,000 | |
| Bills Payable | 20,000 | |
| Underwriting Commission on issue of shares | 10,000 | |
| 5% Debentures (1/5 of the Debentures to be redeemed on 31st March, 2018) | 2,00,000 | |
| Proposed Dividend | 12,000 | |
| Interest accrued and due on 5% Debentures | 8,000 | |
| Trade Receivables | 20,000 | |
| Total | 9,80,000 | 9,80,000 |
Modern Chemicals Co. Ltd. made an issue of 60,000 shares of Rs. 20 each payable as follows :
On application Rs. 5 per share
On allotment Rs. 5 per share
On first call Rs. 4 per share
On second call Rs. 3 per share
The company received applications for 65,000 shares of which applications for 5,000 shares were
rejected and money refunded.
All the shareholders paid up to second call except one shareholder, Mr. Bhupendra, the allotee of
100 shares, who did not pay the amount of the second call.
Give Journal Entries in the books of Modern Chemicals Co., Ltd.
Mr. Prabhakar is a retail trader. He had no proper methods of accounting. But the following information is made available to you.
|
Particulars |
Amount |
Amount |
|
Sundry Debtors Sundry Creditors Bank overdraft Stock Cash in hand Bills receivable Furniture Motor Van Computer 10% Govt. Bonds |
45,000 60,000 80,000 65,000 2,000 60,000 10,000 80,000 60,000 − |
50,000 70,000 40,000 80,000 8,000 80,000 10,000 80,000 1,20,000 10,000 |
Adjustments:
(1) On 1st October, 2009 Mr. Prabhakar had withdrawn Rs. 40,000 for his personal use.
(2) 10% Government Bonds were purchased of Rs. 10,000 on 1st October, 2009.
(3) He had also withdrawn Rs. 30,000 for his daughter's marriage.
(4) Depreciate furniture by 10% and write off Rs. 2,000 from motor van.
(5) Rs 2,000 is written off as bad debts and provide 5% R.D.D. on debtors.
(6) Allow interest on capital at 10% p.a.
(7) Charge interest on drawings Rs. 2,000.
Prepare after taking into consideration the adjustments:
Closing statement of affairs of 31.3.2010.
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