On April 01, 2016 the following balances appeared in the books of Z. Ltd.:

Rs

6% Debentures

1,00,000

Debentures Redemption Reserve Fund

80,000

D.R. Reserve Fund Investments

80,000

The investments consisted of 4% Government securities of the face value of Rs 90,000.

The annual instalment was Rs 16,400. On March 31, 2017, the balance at Bank was Rs 26,000 (after receipt of interest on D.R.Reserve Fund Investment). Investments were realised at 92% and the Debentures were redeemed. The interest for the year had already been paid.

Show the ledger accounts affecting redemption.

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Solution

Book of Z. Ltd.

6% Debentures Account

Dr.

Cr.

Date

Particulars

J.F.

Amount

Rs

Date

Particulars

J.F.

Amount

Rs

2017

2016

Mar. 31

Debenture Holders

1,00,000

Apr. 1

Balance b/d

1,00,000

1,00,000

1,00,000

Debentures Redemption Reserve Fund

Dr.

Cr.

Date

Particulars

J.F.

Amount

Rs

Date

Particulars

J.F.

Amount

Rs

2017

2016

Mar. 31

General Reserve

1,02,800

Apr. 1

Balance b/d

80,000

2017

Mar. 31

Interest on Debenture Redemption Reserve Fund Investment (4% of 90,000)

3,600

Profit and Loss Appropriation

16,400

Debentures Redemption Reserve Fund Investment

2,800

1,02,800

1,02,800

Debenture Redemption Reserve Fund Investment Account

Dr.

Cr.

Date

Particulars

J.F.

Amount

Rs

Date

Particulars

J.F.

Amount

Rs

2016

2017

Apr. 1

Balance b/d (face value Rs 90,000)

80,000

Mar. 31

Bank (92% of 90,000)

82,800

Debentures Redemption Reserve Fund

2,800

82,800

82,800

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Similar questions

On January 1,2011, the following balances appeared in the books of Z Ltd

$\begin{matrix} Items & Rs. 6 % Debentures & 1, 00, 000 Debentures Redemption Reserve Fund & 80, 000 Debentures Redemption Reserve Fund Investments & 80, 000 \end{matrix}$

The investments consisted of 4 % Government securities of the face value of Rs. 90,000.
The annual instalment was Rs. 16,400. On December 31, 2011, the balance at Bank was Rs. 26,000 (after receipt on interest on Debenture Redemption Reserve Fund Investment). Investments were realised at 92 % and the Debentures were redeemed. The interest for the year had already been paid.
Show the ledger accounts affecting redemption.

The following balances appeared in the books of Z.Ltd. on April 01, 2016

	Rs
12% Debentures	1,50,000
Debentures Redemption Fund	1,25,000
Debentures Redemption Fund Investment	1,25,000
(Represented by Rs 1,47,500, 3% Govt. Securities)	1,25,000

The annual instalment added to the fund is Rs 20,575. On March 31, 2017, the bank balance after the receipt of interest on the investment was Rs 39,100. On that date, all the investments were sold at 83 per cent and the debentures were duly redeemed.

Show the necessary ledger accounts for the year 2016-17.

The following balances appeared in the books of A.Ltd. on April 01, 2017

	Rs
12% Debentures	4,00,000
Debentures Redemption Fund	3,60,000
Debentures Redemption Fund Investment	3,60,000
Securities Premium	30,000
Bank Balance	1,00,000

On April 01, 2017, the company redeemed all the debentures at 105 per cent out of funds raised by selling all the investments at Rs 3,48,000. Prepare the necessary ledger accounts.

The following balances appeared in the books of Z Ltd on January 1,2004.

$\begin{matrix} Items & Rs. 12% Debentures & 1, 50, 000 Debentures Redemption Reserve Fund & 1, 25, 000 Debentures Redemption Fund Investment & 1, 25, 000 (Represented by Rs. 1,47,500, 3 % Govt. Securities ) & 1, 25, 000 \end{matrix}$

The annual installment added to the fund is Rs. 20,575. On December 31,2004, the bank balance after the receipt of interest on the investment was Rs. 39,100. On that date, all the invesment were sold at 83% and the debentures were duly redeemed.
Show the necessary ledger accounts for the year 2004.

On April 01, 2014 a company issued 15% debentures of Rs 10,00,000 at par. The debentures were redeemable at par after three years from the date of Issue. A sinking fund was set up to raise funds for redemption of debentures. The amount for the purpose was invested in 6% Government securities of Rs 100 each available at par. The sinking fund table shows that if investments earn 6% per annum, to get Re.1 at the end of 3 years, one has to invest Rs 0.31411 every year together with interest that will be earned. On March 31, 2017, all the Government securities were sold at a total loss of Rs 6,000 and the debentures were redeemed at par.

Prepare Debentures Account Sinking Fund Account, Sinking Fund Investment Account and Interest on Sinking Fund Investment Company closes its books of accounts every year on March 31.

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Book of Z. Ltd. 6% Debentures Account
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2017				2016
Mar. 31	Debenture Holders		1,00,000	Apr. 1	Balance b/d		1,00,000
			1,00,000				1,00,000

	Rs
6% Debentures	1,00,000
Debentures Redemption Reserve Fund	80,000
D.R. Reserve Fund Investments	80,000

Debentures Redemption Reserve Fund
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2017				2016
Mar. 31	General Reserve		1,02,800	Apr. 1	Balance b/d		80,000
				2017
				Mar. 31	Interest on Debenture Redemption Reserve Fund Investment (4% of 90,000)		3,600
					Profit and Loss Appropriation		16,400
					Debentures Redemption Reserve Fund Investment		2,800
			1,02,800				1,02,800

Debenture Redemption Reserve Fund Investment Account
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2016				2017
Apr. 1	Balance b/d (face value Rs 90,000)		80,000	Mar. 31	Bank (92% of 90,000)		82,800
	Debentures Redemption Reserve Fund		2,800
			82,800				82,800