A.Ltd. Issued 50,00,000, 8% Debenture Of Rs 100 At a Discount Of 6% On April 01, 2009 Redeemable At Premium of 4% By Draw l Accountancy

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A.Ltd. issued 50,00,000, 8% Debenture of Rs 100 at a discount of 6% on April 01, 2009 redeemable at premium of 4% by draw of lots as under:

20,00,000 Debentures on March, 2011

10,00,000 Debentures on March, 2013

20,00,000 Debentures on March, 2014

Compute the amount of discount to be written-off in each year till debentures are paid. Also prepare discount/loss on issue of debenture account.




At the endDebenture OutstandingRatioLoss to be written offTotal sum
March 201050,00,00,00055,00,00,000×5181,38,88,889
March 201150,00,00,00055,00,00,000×5181,38,88,889
March 201230,00,00,00035,00,00,000×31883,33,333
March 201330,00,00,00035,00,00,000×31883,33,333
March 201420,00,00,00025,00,00,000×21855,55,556
  18 Rs 5,00,00,000

Loss on issue of debenture = 6% (discount on issue) + 4% (premium on redemption) = 10% 

= 50,000 x 100 x 10/100= 5,00,00,000

Loss on Issue of Debenture Account

DateParticularsJ.F.Amount
 (Rs.)		DateParticularsJ.F.Amount 
(Rs.)
2009 April, 01Debenture 5,00,00,0002010 March, 31Profit and Loss 1,38,88,889
     Balance c/d 3,61,11,111
   5,00,00,000   5,00,00,000
2010 April, 01Balance b/d 3,61,11,1112011 March, 31Profit and Loss 1,38,88,889
     Balance c/d 2,22,22,222
   3,61,11,111   3,61,11,111
2011 April, 01Balance b/d 2,22,22,2222012 March, 31Profit and Loss 83,33,333
     Balance c/d 1,38,88,889
   2,22,22,222   2,22,22,222
2012 April, 01Balance b/d 1,38,88,8892013 March, 31Profit and Loss 83,33,333
     Balance c/d 55,55,556
   1,38,88,889   1,38,88,889
2013 April, 01Balance b/d 55,55,5562014 March, 31Profit and Loss 55,55,556
   55,55,556   55,55,556


Chapter-2 Issue and Redemption of Debentures-II



Location: India

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