Respuesta :
Answer:
1. When the application money is reieved, Debit Bank for Rs.1,100,000; and Credit Debentures Application and Allotment a/c for Rs.1,100,000,
2. To transfer of application money along with premium on debentures allotted to the debentures account, Debit Debentures Application and Allotment a/c for Rs.1,100,000; Debit Debenture a/c for Rs.1,000,000; and Credit Security Premium Reserve a/c for Rs.100,000.
Explanation:
Since allotment were made, it implies the accounts for application and allotment can be combined. Therefore, the journal entries will look as follows:
Accounts Title Dr (Rs.) Cr (Rs.)
Bank (w.1) 1,100,000
Debentures Application and Allotment a/c 1,100,000
(To record the amount received from debenture application with the premium)
Debentures Application and Allotment a/c 1,100,000
Debenture a/c (w.2) 1,000,000
Security Premium Reserve a/c (w.3) 100,000
(To record the transfer of application money along with premium on debentures allotted to the debentures account)
Working:
w.1: Bank = (Units of debentures * Unit price) * (1 + Premium rate) = (10,000 * Rs.100) * (1 + 10%) = Rs. 1,100,000
w.2. Debenture = Units of debentures * Unit price = 10,000 * Rs.100 = Rs.1,000,000
w.3 Security Premium Reserve = Debenture * Premium rate = Rs.1,000,000 * 10% = Rs.100,000
