Question

Mona Ltd. issued 4.000, 8% debentures of Rs. 100 each at a premium of 10% payable Rs 20 on application and the balance with premium on allotment. Expenses on issue of debentures were Rs. 500, Pass necesary. Journal entries.

Answer 1

Journal entries
Date	Particulars		L/F	Amount	Amount
	Bank A/c	Dr..		80,000
	To 8% Debentures Application A/c				80,000
	(for application money received on 4000 debentures @ 20 each)
	8% Debenture application A/c	Dr..		80,000
	To Debentures A/c				80,000
	(For transfer of applicaton money to debentures A/c)
	8% Debentures Allotment A/c	Dr..		360,000
	To 8% Debentures A/c				320,000
	To Securities Premium A/c				40,000
	(For allotment money due on 4000 debentures together with premium.)
	Bank A/c	Dr..		360,000
	To 8% Debenture Allotment A/c				360,000
	(For allotment money received)
	Expenses on Issure of 8%
	debenture A/c	Dr..		500
	To Bank A/c				500
	(For payment of Expenses on Issue of debentures.)
	Securities Premium A/c	Dr..		500
	To Expenses on Issue of debentures A/c				500
	(For Expenses on Issue of debentures written off.)