Question

XYZ Ltd had 12% debentures of Rs 10,00,000 as on 1-04-2014. During the year company took a loan of Rs 4,00,000 from bank. It issured their 12 % debentures worth Rs 5,00,000 as collateral security. Pass necessary Journal entries. (Using Debenture Suspense Method)

Answer 1

JOURNAL
$\begin{array}{cccccc}\text{Date}& \text{Particulars}& & \text{L.F.}& \text{Debit}& \text{credit}\\ & & & & \text{(Rs)}& \text{(Rs)}\\ & \text{Bank A/c}& Dr.& & 4,00,000& \\ & \text{To Bank Loan A/c}& & & & 4,00,000\\ & \underset{–}{\text{(Being bank loan is taken by the company)}}& & & & \\ & \text{Debenture Suspence A/c}& Dr.& & 5,00,000& \\ & \text{To 12}\%\text{Debentures A/c}& & & & 5,00,000\\ & \text{(Being debentures issued as a collateral security)}& & & & \end{array}$