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Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.?
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Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st ...
Journal Entries for Purchase and Cancellation of Debentures
Purchase of Debentures:
Date: 1.4.2017
Debit: Own Debentures A/c (1,000 debentures at Rs.95) - Rs.95,000
Credit: Bank A/c - Rs.95,000
Date: 31.3.2018
Debit: Own Debentures A/c (400 debentures at Rs.105) - Rs.42,000
Credit: Bank A/c - Rs.42,000
Date: 31.3.2019
Debit: Own Debentures A/c (600 debentures at Rs.100) - Rs.60,000
Credit: Bank A/c - Rs.60,000
Cancellation of Debentures:
Date: 31.3.2017
Debit: Own Debentures A/c (1,000 debentures at Rs.100) - Rs.1,00,000
Credit: Debenture Redemption Reserve A/c - Rs.1,00,000
Date: 31.3.2018
Debit: Own Debentures A/c (400 debentures at Rs.100) - Rs.40,000
Credit: Debenture Redemption Reserve A/c - Rs.40,000
Date: 31.3.2019
Debit: Own Debentures A/c (600 debentures at Rs.100) - Rs.60,000
Credit: Debenture Redemption Reserve A/c - Rs.60,000
Interest Entries:
Date: 31.3.2016
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Date: 31.3.2017
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Date: 31.3.2018
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Date: 31.3.2019
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Explanation:
Tata Steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April 2015. The company purchased 1,000 debentures at Rs.95 on 1st April 2017, 400 debentures at Rs.105 on 31st March 2018, and 600 debentures at Rs.100 on 31st March 2019 from the open market with a view to cancel them.
The journal entries for the purchase of debentures are made by debiting the Own Debentures A/c and crediting the Bank A/c. The journal entries for the cancellation of debentures are made by debiting the Own Debentures A/c and crediting the Debenture Redemption Reserve A/c.
Further, the company needs
Purchase of Debentures:
Date: 1.4.2017
Debit: Own Debentures A/c (1,000 debentures at Rs.95) - Rs.95,000
Credit: Bank A/c - Rs.95,000
Date: 31.3.2018
Debit: Own Debentures A/c (400 debentures at Rs.105) - Rs.42,000
Credit: Bank A/c - Rs.42,000
Date: 31.3.2019
Debit: Own Debentures A/c (600 debentures at Rs.100) - Rs.60,000
Credit: Bank A/c - Rs.60,000
Cancellation of Debentures:
Date: 31.3.2017
Debit: Own Debentures A/c (1,000 debentures at Rs.100) - Rs.1,00,000
Credit: Debenture Redemption Reserve A/c - Rs.1,00,000
Date: 31.3.2018
Debit: Own Debentures A/c (400 debentures at Rs.100) - Rs.40,000
Credit: Debenture Redemption Reserve A/c - Rs.40,000
Date: 31.3.2019
Debit: Own Debentures A/c (600 debentures at Rs.100) - Rs.60,000
Credit: Debenture Redemption Reserve A/c - Rs.60,000
Interest Entries:
Date: 31.3.2016
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Date: 31.3.2017
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Date: 31.3.2018
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Date: 31.3.2019
Debit: Interest on Debentures A/c - Rs.1,20,000
Credit: Debenture Interest Payable A/c - Rs.1,20,000
Explanation:
Tata Steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April 2015. The company purchased 1,000 debentures at Rs.95 on 1st April 2017, 400 debentures at Rs.105 on 31st March 2018, and 600 debentures at Rs.100 on 31st March 2019 from the open market with a view to cancel them.
The journal entries for the purchase of debentures are made by debiting the Own Debentures A/c and crediting the Bank A/c. The journal entries for the cancellation of debentures are made by debiting the Own Debentures A/c and crediting the Debenture Redemption Reserve A/c.
Further, the company needs
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Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.?
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Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.?.
Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.?.
Solutions for Q.1-Tata steel Ltd. issued 2,000, 6% debentures of Rs.100 each on 1st April, 2015 The company made the following purchases of its own debentures in the open market with a view to cancel them: 1.4.2017- 1,000 debentures at Rs.95 31.3.2018 400 debentures at Rs.105 31.3.2019 600 debentures at 100 Give Journal entries with regard to purchase and cancellation of debentures. Entries for interest to be also made.? in English & in Hindi are available as part of our courses for B Com.
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