A company issued 30,000, 9% Debenture of ₹100 each, at 5% premium. These debentures are to be redeemed at 15% premium at the end of 4 years. Existing Balance in Securities Premium before Issue of Debentures was ₹80,000. Identify the amount to be credited to Statement of Profit and Loss for the year on issue of Debentures.
₹3,70,000
Premium on Issue = 30,000 × ₹5 = ₹1,50,000 Premium on Redemption = 30,000 × ₹15 = ₹4,50,000 Amount credited to Statement of Profit and Loss = ₹4,50,000.
Important Questions from Accounting for Debentures
When debentures are issued at a premium and redeemed at a premium, the journal entry will have the following combination:
(A) Discount on issue of debentures account is credited
(B) Loss on issue of debentures account is debited
(C) Security premium account is credited
(D) Premium on redemption of debentures account is credited
Choose the correct answer from the options given below:
Arrange the following in the correct sequence in the context of debenture:
(A) Payment to debenture-holders
(B) Creation of DRR
(C) Issue of debentures
(D) Redemption becomes due
Choose the correct answer from the options given below:
Balance of Debenture Redemption Reserve A/c after the redemption of debenture is credited to:
Calculate the number of Debentures issued by A Ltd. for consideration other than cash:
‘Discount on issue of debenture’, which is to be written off under one operating cycle is shown under:
