Question

Narain Laxmi Ltd. invited applications for issuing 7,500; 12% Debentures of ₹ 100 each at a premium of ₹ 35 per debenture . The full amount was payable on application. Applications were received for 10,000 Debentures. Allotment was made to all the applications on pro rata.
Pass necessary Journal entries for the above transactions in the books of Narain Laxmi Ltd.

Answer 1

In the Books of Narain Laxmi Ltd. Journal
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
	Bank A/c (10,000 debentures × 135)	Dr.		13,50,000
	To Debenture Application and Allotment A/c				13,50,000
	(Application money received on 10,000 12% debenture)
	Debenture Application and Allotment A/c	Dr.		13,50,000
	To 12% Debentures A/c				7,50,000
	To Securities Premium Reserve A/c				2,62,500
	To Bank A/c				3,37,500
	(7,500; 12% Debentures of Rs 100 each issued at a premium of Rs 35 and excess money refunded)