Page 95 - AAAXII

Model Test Papers M.89
Or

JOURNAL OF SIMTECH LTD.
Date Particulars L.F. Dr. (`) Cr. (`)

Before Redemption of Debentures
Surplus, i.e., Balance in Statement of Profit and Loss A/c ...Dr. 3,00,000
To Debentures Redemption Reserve A/c (` 12,00,000 × 25%) 3,00,000
(Being the transfer of profit to Debentures Redemption Reserve)
Debentures Redemption Investment A/c (` 12,00,000 × 15%) ...Dr. 1,80,000
To Bank A/c 1,80,000
(Being the investment made @ 15% of face value of debentures)
Bank A/c ...Dr. 1,80,000
To Debentures Redemption Investment A/c 1,80,000
(Being the investment encashed)
On Redemption of Debentures
10% Debentures A/c ...Dr. 12,00,000
To Debentureholders’ A/c 12,00,000
(Being the amount due to debentureholders on redemption)

Debentureholders’ A/c ...Dr. 12,00,000
To Bank A/c 12,00,000
(Being the amount due to debentureholders paid)

Debentures Redemption Reserve A/c ...Dr. 3,00,000
To General Reserve A/c 3,00,000
(Being the transfer of Debentures Redemption Reserve to General Reserve
on the redemption of all the debentures)

10. JOURNAL OF X LTD.
Date Particulars L.F. Dr. (`) Cr. (`)

Bank A/c (20,00,000 × ` 15) ...Dr. 3,00,00,000
To Equity Shares Application and Allotment A/c 3,00,00,000
(Being the application and allotment money on 20,00,000 shares)

Equity Shares Application and Allotment A/c ...Dr. 3,00,00,000
To Equity Share Capital A/c (7,50,000 × ` 10) 75,00,000
To Securities Premium Reserve A/c (7,50,000 × ` 5) 37,50,000
To Bank A/c (12,50,000 × ` 15)* 1,87,50,000
(Being the shares application and allotment money adjusted for
7,50,000 equity shares and the balance refunded)

* In the given case, the entire amount is payable on application.
So the surplus amount of ` 1,87,50,000 (i.e., 12,50,000 × ` 15) will be refunded to the applicants.