Ownclasses

Narain Laxmi Ltd. invited applications for issuing 7500, 12% Debentures of Rs100 each at a premium of Rs 35 per Debenture. The full amount was payable on application.
Applications were received for 10,000 Debentures. Applications for 2500 Debentures were rejected and the application money was refunded. Debentures were allotted to the remaining applicants.
Pass necessary Journal Entries for the above transactions in the books of Narain Laxmi Ltd. 

Answer

Date

Particulars

LF

Debit (Rs)

Credit (Rs)

 

Bank a/c Dr

          To 12% Debenture application a/c

Being application money received for 10000,12% debentures of Rs 100 each, issued at a premium of Rs 35 per debenture)

 

13,50,000

 

 

 

 

10,12,500

 

 

 

 

3,37,500

 

13,50,000

 

 

 

 

7,50,000

2,62,500

 

 

 

3,37,500

 

 

12% Debenture application a/c         Dr

          To 12% debenture a/c

          To debenture premium a/c

Transfer of application money of 7500 debentures on allotment)

12% debenture application a/c          Dr

           To Bank a/c

( being application money of 2500 applications oversubscribed refunded)