Health Foods Ltd. had 10,000, 9% Debentures of ₹ 100 each due for redemption at a premium of ₹ 10 each as follows:
Health Foods Ltd. had 10,000, 9% Debentures of ₹ 100 each due for redemption at a premium of ₹ 10 each as follows:
| On 30th September, 2020 | 3,000 Debentures |
| On 30th September, 2021 | 2,000 Debentures |
| On 30th September, 2022 | Balance Debentures |
Pass the Journal entries for investment in specified securities for the above, Investment is made on 30th April.
Anurag Pathak Changed status to publish November 2, 2023
Solution:-
Working Notes:
(i) DRI = 15% of ₹ 3,00,000.
(ii) After realisation of securities, balance investment in Specified Securities is ₹ 30,000, i.e., 15% of ₹ 2,00,000, i.e., debentures to be redeemed on 30th Septemeber, 2021)
(iii) After this investment, investment in specified securities is ₹ 75,000 (₹ 30,000 + ₹ 45,000) (i.e., 15% of ₹ 5,00,000, equal to nominal value of debentures to be redeemed on 30th September, 2022).
(iv) At the time of redemption on 30th September, 2022, total investment will be realised, since all the debentures are
Anurag Pathak Changed status to publish November 2, 2023
