AG Limited issued 3000 14% debentures of rupees 100 each on 1st April 2020 the issue was fully subscribed according - Accountancy - Accounting for Not-for-Profit Organisation

Question

AG Limited issued 3000 14% debentures of rupees 100 each on 1st
April 2020 the issue was fully subscribed according to the terms of
issue interest on debentures is payable half-yearly on 30 September
and 31st March Pass necessary journal entries relating to the
debenture interest for the half year ending 31st March 2021 and
transfer of interest on debentures to the statement of profit and
loss

Aquib Javed · Accepted Answer

Solution:
AG LIMITED
JOURNAL ENTRIES

DATE
PARTICULARS
DR (RS )
CR (RS )

30 09 2020
Debenture Interest A/c(Rs 3,00,000*14%*6/12) Dr
21,000

To Debenture holders A/c

21,000

(Being interest on debentures payable for the half year ended
30th September 2020)

Debenture holders A/c Dr
21,000

To Bank A/c

21,000

(Being interest paid to debenture holders)

31 03 2021
Debenture Interest A/c(Rs 3,00,000*14%*6/12) Dr
21,000

To Debenture holders A/c

21,000

(Being Interest on Debentures payable for the half year ended
31st March 2021)

Debenture holders A/c Dr
21,000

To Bank A/c

21,000

(Being interest paid to debenture holders)

31 03 2021
Statement of Profit & Loss A/c Dr
42,000

To Debenture Interest A/c

42,000

(Being interest on debenture transferred to Statement of Profit
& Loss A/c)

DATE	PARTICULARS	DR. (RS.)	CR. (RS.)
30.09.2020	Debenture Interest A/c(Rs.3,00,00014%6/12) Dr.	21,000
	To Debenture holders A/c		21,000
	(Being interest on debentures payable for the half year ended 30th September 2020)
	Debenture holders A/c Dr.	21,000
	To Bank A/c		21,000
	(Being interest paid to debenture holders)
31.03.2021	Debenture Interest A/c(Rs.3,00,00014%6/12) Dr.	21,000
	To Debenture holders A/c		21,000
	(Being Interest on Debentures payable for the half year ended 31st March 2021)
	Debenture holders A/c Dr.	21,000
	To Bank A/c		21,000
	(Being interest paid to debenture holders)
31.03.2021	Statement of Profit & Loss A/c Dr.	42,000
	To Debenture Interest A/c		42,000
	(Being interest on debenture transferred to Statement of Profit & Loss A/c)