Question

X Ltd invites application for the issue of 10,000, 14% debentures of Rs.100 each payable as to Rs.20 on application, Rs.60 on allotment and the balance on call. The company receives applications for 13,500 debentures, out of which application for 8,000 debentures are allotted in full, 5,000 only 40% and the remaining rejected. The surplus money on partially allotted applications is utilised towards allotment. All the sums due are duty received.

Answer 1

$\text{Journal Entries}$
$\begin{array}{cccccc}\text{Date}& \text{Particulars}& & \text{LF}& \text{Amt. (Dr)}& \text{Amt.(Cr)}\\ \text{(i)}& \text{Bank A/c}& \text{Dr}& & 2,70,000& \\ & \text{To 14\% Debenture Application A/c}& & & & 2,70,000\\ & \text{(14\% debenture application money for}& & & & \\ & \text{13,500 debentures at Rs. 20 each received.)}& & & & \\ & \underset{–}{}& & & & \\ \text{(ii)}& \text{14\% Debentures Applications A/c}& \text{Dr}& & 2,70,000& \\ & \text{To 14\% Debentures A/c}(10,000\times 20)& & & & 2,00,000\\ & \text{To 14\% Debentures Allotment A/c}(3,000\times 20)& & & & 60,000\\ & \text{To Bank A/c}(500\times 20)& & & & 10,000\\ & \text{(14\% debentures application money of}& & & & \\ & \text{10,000 at Rs.20 each transferred to 14\% debentures}& & & & \\ & \text{account and 500 debentures were rejected and}& & & & \\ & \text{returned and rest of the amount adjusted}& & & & \\ & \text{on allotment.)}& & & & \\ & \underset{–}{}& & & & \\ \text{(iii)}& \text{Bank A/c}& \text{Dr}& & 5,40,000& \\ & \text{To 14\% Debentures Allotment A/c}& & & & 5,40,000\\ & \text{(14\% debentures allotment money received on}& & & & \\ & \text{10,000 debentures at Rs.60 each.)}& & & & \\ & \underset{–}{}& & & & \\ \text{(iv)}& \text{14\% Debentures Allotment A/c}& \text{Dr}& & 6,00,000& \\ & \text{To 14\% Debentures A/c}& & & & 6,00,000\\ & \text{(14\% debentures allotment money transferred}& & & & \\ & \text{(to debentures account)}& & & & \\ & \underset{–}{}& & & & \\ \text{(v)}& \text{Bank A/c}& \text{Dr}& & 2,00,000& \\ & \text{To 14\% Debentures First and Final Call A/c}& & & & 2,00,000\\ & \text{(14\% debentures first and final call money}& & & & \\ & \text{received on 10,000 debentures at 20 each.)}& & & & \\ & \underset{–}{}& & & & \\ \text{(vi)}& \text{14\% Debentures First and Final Call A/c}& \text{Dr}& & 2,00,000& \\ & \text{To 14\% Debentures A/c}& & & & 2,00,000\\ & \text{(14\% debentures first and final call money}& & & & \\ & \text{on 10,000 debentures at Rs.20 each, transferred to debentures account.)}& & & & \\ & \underset{–}{}& & & & \end{array}$