[ISC] Q 21, 22 Redemption of Debenture TS Grewal (2026-27)
Solution of question number 21 and 22 of Redemption of Debenture Ts Grewal class 12 ISC Board (2026-27)
Q. 21. Binaca Ltd., an unlisted (Non-NBFC/HFC) company, issued ₹ 40,00,000; 8% Debentures of ₹ 100 each on 1st April, 2019. The terms of issue stated tht the debentures are to be redeemed at a premium of 5% on 30th June, 2021. The company decided to transfer ₹ 10,00,000 out of profits to Debentures Redemption Reserve on 31st March, 2020 and ₹ 2,00,000 on 31st March, 2021.
Pass Journal entries regarding the issue and redemption of debentures, DRR and Investment without providing for the interest or loss on issue of debentures.
Solution:-
Q. 22. F & R Ltd. issued 5,000, 9% Debentures of ₹ 100 each at par on 1st April, 2020 redeemable at par on 31st March, 2022. The company transferred the required amount to DRR out of Surplus, i.e., Balance in Statement of Profit & Loss on 31st March, 2021. It invested the specified amount in fixed deposit with Canara Bank on 1st April, 2021 earning 8% interest. Interest is paid on debentures annually on 31st March.
Pass Journal entries for issue and redemption of debentures, DRR, investment and interest on debentures.
Solution:-
