Fit India Ltd. has paid-up share capital of ₹ 1,00,00,000 (divided into 5,00,000 Equity Shares of ₹ 20 each) and 10,000, 7% Debentures of ₹ 200 each. On 1st July, 2021, it further issued 7% Debentures at a premium of 10% redeemable at 25% premium to meet the long-term funds requirement of ₹ 1,65,00,000. The issue price was payable along with application. Balance in Securities Premium Account after the issue of debentures of ₹ 25,00,000. Loss for the year ended 31st March, 2022 is ₹ 10,00,000.
You are required to:
- Pass Journal entries for issue of Debentures.
- Prepare Loss on Issue of Debentures Account.
- Pass Journal entries for interest on debentures, If interest is payable on 30th September and 31st March each year.
Solution :
