Following transactions are the related to Humza Company face value of ...
Journal Entries for Humza Company Debentures
Below are the general journal entries for the transactions related to the issuance of debentures by Humza Company:
1. Issuance of 5% Debentures
- Date: [Transaction Date]
- Dr. Bank Account Rs. 1,00,000 (1000 Debentures x Rs. 100)
- Cr. 5% Debentures Account Rs. 1,00,000
2. Issuance of 6% Debentures at Premium
- Date: [Transaction Date]
- Dr. Bank Account Rs. 2,04,000 (2000 Debentures x Rs. 102)
- Cr. 6% Debentures Account Rs. 2,00,000
- Cr. Securities Premium Account Rs. 4,000
3. Issuance of 2% Debentures at Discount
- Date: [Transaction Date]
- Dr. Bank Account Rs. 96,000 (1000 Debentures x Rs. 96)
- Dr. Discount on Debentures Account Rs. 4,000 (1000 Debentures x (Rs. 100 - Rs. 96))
- Cr. 2% Debentures Account Rs. 1,00,000
4. Issuance of 6% Debentures at Par
- Date: [Transaction Date]
- Dr. Bank Account Rs. 1,00,000 (1000 Debentures x Rs. 100)
- Cr. 6% Debentures Account Rs. 1,00,000
5. Issuance of 5% Debentures at Discount
- Date: [Transaction Date]
- Dr. Bank Account Rs. 95,000 (1000 Debentures x Rs. 95)
- Dr. Discount on Debentures Account Rs. 5,000 (1000 Debentures x (Rs. 100 - Rs. 95))
- Cr. 5% Debentures Account Rs. 1,00,000
Summary of Transactions
- The above entries record the issuance of debentures under various terms, noting whether they are issued at par, at a premium, or at a discount.
- Premiums and discounts are recorded in separate accounts to reflect the actual cost to the company.
- These journal entries are essential for accurate financial reporting and compliance in accordance with accounting standards.
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