Question

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.

Answer 1

Books of Z. Ltd. Journal 12% Debentures Account
Dr.							Cr.
Date	Particulars	J.F.	Amount Rs	Date	Particulars	J.F.	Amount Rs
2017				2016
Mar. 31	Debenture Holders		1,50,000	Apr. 01	Balance b/d		1,50,000
			1,50,000				1,50,000

Debenture Redemption Fund Account
Dr.					Cr.
Date	Particulars	J.F.	Amount Rs	Date		Particulars	J.F.	Amount Rs
2017				2016
Mar. 31	Debentures Redemption Fund Investment		2,575	Apr. 01		Balance b/d		1,25,000
Mar. 31	General Reserve		1,47,425	2017
				Mar. 31		Profit and Loss Appropriation		20,575
				Mar. 31		Interest on Debentures Redemption Fund Investment		4,425
			1,50,000					1,50,000

Debenture Redemption Fund Investment Account
Dr.					Cr.
Date	Particulars	J.F.	Amount Rs	Date		Particulars	J.F.	Amount Rs
2016				2017
Apr. 01	Balance b/d (Face value Rs 1,47,500)		1,25,000	Mar. 31		Bank		1,22,425
						Debentures Redemption Fund (Loss)		2,575
			1,25,000					1,25,000

Bank Account
Dr.					Cr.
Date	Particulars	J.F.	Amount Rs	Date		Particulars	J.F.	Amount Rs
2016				2017
Apr. 31	Balance b/d		39,100	Mar. 31		Debentureholders		1,50,000
2017 Mar. 31	Debentures Redemption Fund		1,22,425			Balance c/d		11,525
			1,61,525					1,61,525