100,000 The ratio of debenture is 300:300:300:200:100 ie.3:3:3:2:1 Debenture Discount Account Amount Amount Date Particulars Date Particulars Dr. Cr. 1998 1998 Jan.01 To 8% 18,000 Dec.31 By P & L. A/c 4,500 Debenture By Balance c/d 13,500 18,000 18,000 1999 1999 Jan 01 To balance 13,500 Dec.31 By P&L A/c 4,500 b/d By Balance c/d 9,500 13,500 13,500 2000 2000 Jan.01 To Balance 9,500 Dec.31 By P&L Account 4,500 b/d By Balance b/d 4,500 9,500 9,500 2001 2001 Jan.01 To Balance 4,500 Dec.31 By P&L Account 3,000 b/d By Balance b/d 1,500 4,500 4,500 2002 2002 Jan.01 To Balance 1,500 Dec.31 By P&L Account 1,500 b/d 1,500 1,500 Illustration 5.06 A company issued debentures of Rs.30,000 at a discount of 10%, to be redeemed at the end of 3 years in lump sum. Pass Journal Entries for the three years. The discount on issue of debenture Rs.3000 is distributed equally for the three years, because the debenture balances are same in all these three years. Particulars Amount Amount Dr. Cr. 1st Bank Account 27,000 Year Dr. 3,000 begin. Discount on Issue of Deb. 30,000 Dr. To Debenture Account (Debentures issued at discount) 1st year Profit and Loss Account 1,000 End Dr. 1,000 To Discount on Issue of Deb.
100,000 The ratio of debenture is 300:300:300:200:100 ie.3:3:3:2:1 Debenture Discount Account Date Particulars Amount Dr. Date Particulars Amount Cr. 1998 Jan.01 To 8% Debenture 18,000 1998 Dec.31 By P & L. A/c By Balance c/d 4,500 13,500 18,000 18,000 1999 Jan 01 To balance b/d 13,500 1999 Dec.31 By P&L A/c By Balance c/d 4,500 9,500 13,500 13,500 2000 Jan.01 To Balance b/d 9,500 2000 Dec.31 By P&L Account By Balance b/d 4,500 4,500 9,500 9,500 2001 Jan.01 To Balance b/d 4,500 2001 Dec.31 By P&L Account By Balance b/d 3,000 1,500 4,500 4,500 2002 Jan.01 To Balance b/d 1,500 2002 Dec.31 By P&L Account 1,500 1,500 1,500 Illustration 5.06 A company issued debentures of Rs.30,000 at a discount of 10%, to be redeemed at the end of 3 years in lump sum. Pass Journal Entries for the three years. The discount on issue of debenture Rs.3000 is distributed equally for the three years, because the debenture balances are same in all these three years. Particulars Amount Dr. Amount Cr. 1st Year begin. Bank Account Dr. Discount on Issue of Deb. Dr. To Debenture Account (Debentures issued at discount) 27,000 3,000 30,000 1st year End Profit and Loss Account Dr. To Discount on Issue of Deb. 1,000 1,000
217622_47073_company_account.docx