Page 241 - ISCDEBK-12

Joint Stock Company—Redemption of Debentures 9.15

2015
March 31 Interest on Debentures A/c ...Dr. 80,000
To Debentureholders’ A/c 72,000
To TDS Payable A/c 8,000
(Being the interest due on 8% Debentures for one year and
TDS deducted @ 10%)
Debentureholders’ A/c ...Dr. 72,000
To Bank A/c 72,000
(Being the interest on debentures paid)
TDS Payable A/c ...Dr. 8,000
To Bank A/c 8,000
(Being the TDS deposited in Government Account)
Surplus, i.e., Balance in Statement of Profit and Loss A/c ...Dr. 1,25,000
To Debentures Redemption Reserve A/c 1,25,000
(Being one-half of total DRR required transferred)

Statement of Profit and Loss ...Dr. 80,000
To Interest on Debentures A/c 80,000
(Being the interest transferred)
April 1 Debentures Redemption Investment A/c ...Dr. 37,500
To Bank A/c 37,500
(Being the investment made in fixed deposit with bank earning
interest @ 6%)
2016
March 31 Interest on Debentures A/c ...Dr. 80,000
To Debentureholders’ A/c 72,000
To TDS Payable A/c 8,000
(Being the interest due on 20,000, 8% Debentures for one year and
TDS deducted @ 10%)
Debentureholders’ A/c ...Dr. 72,000
To Bank A/c 72,000
(Being the interest on debentures paid)
TDS Payable A/c ...Dr. 8,000
To Bank A/c 8,000
(Being the TDS deposited in Government Account)
Interest Accrued But Not Due A/c ...Dr. 2,025
TDS Collected (Receivable) A/c ...Dr. 225
To Interest Earned A/c 2,250
(Being the interest on fixed deposit @ 6% provided, TDS was
deducted by Bank @ 10%)
Surplus, i.e., Balance in Statement of Profit and Loss A/c ...Dr. 1,25,000
To Debentures Redemption Reserve A/c 1,25,000
(Being one-half of total DRR required transferred)

8% Debentures A/c ...Dr. 2,50,000
Premium on Redemption of Debentures A/c ...Dr. 50,000
To Debentureholders’ A/c 3,00,000
(Being the amount due on 5,000; 8% Debentures on redemption)