X.Ltd. purchased a Machinery from Y for an agreed purchase consideration of Rs 4,40,000 to be satisfied by the issue of 12% debentures of Rs 100 each at a premium of Rs 10 per debenture. Journalise the transactions.

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Solution

Books of X. Ltd.

Journal

Date

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

Machinery A/c

Dr.

4,40,000

To Y

4,40,000

(Machinery purchased from Y)

Y

Dr.

4,40,000

To 12% Debentures A/c

4,00,000

To Securities Premium A/c

40,000

(Allotted 4,000 debentures of Rs 100 each at a premium

of Rs 10 per debenture in consideration of Machinery

purchased)

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Similar questions

X Ltd purchased a machinery from Y for an agreed purchase consideration of Rs.4,40,000 to be satisfied by the issue of 12% Debentures of Rs.100 each at a premium of Rs.10 per Debenture. Journalise the transaction.

Q. N Ltd. purchased fixed asset of Rs. 28,80,000. The consideration was paid by issue of 12% Debenture of 100 each at 20% premium. Number of debentures to be issued will be _______.

B.Ltd. purchased assets of the book value of Rs 4,00,000 and took over the liability of Rs 50,000 from Mohan Bros. It was agreed that the purchase consideration, settled at Rs,3,80,000, be paid by issuing debentures of Rs 100 each.

What Journal entries will be made in the following three cases, if debentures are issued: (a) at par; (b) at discount; (c) at premium of 10%? It was agreed that any fraction of debentures be paid in cash.

Exercise

Amar Ltd. purchased assets of the book value of Rs 99,000 from Abhi Ltd. It was agreed that purchase consideration to be paid by issuing 11% Debentures of Rs 100 each Assume debentures have been issued.

1. At par

2. At Discount of 10% and

3. At Premium of 10%

Record necessary journal entries

A company purchased assets of the book value of Rs 99,000 from another Co. It was agreed that the purchase consideration be paid by issuing $11 %$ Debentures of Rs 100 each. Assume that the debentures have been issued (i) at par, (ii) at a discount of $10 %$ , and (iii) at a premium of $10 %$ .

Give necessary journal entries in the books of purchasing company.

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Books of X. Ltd. Journal
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
	Machinery A/c	Dr.		4,40,000
	To Y				4,40,000
	(Machinery purchased from Y)

	Y	Dr.		4,40,000
	To 12% Debentures A/c				4,00,000
	To Securities Premium A/c				40,000
	(Allotted 4,000 debentures of Rs 100 each at a premium of Rs 10 per debenture in consideration of Machinery purchased)