Redemption of Debentures Accountancy - Redemption of Debentures

In case debentures of ₹ 10,000 are issued at par but redeemable at a premium of 10%, the premium payable is debited to:

1. Debentures Suspense Account.
2. Premium on Redemption of Debentures Account.
3. Loss on Issue of Debentures Account.
4. Both (a) and (c).

The provisions of the Companies Act, 2013 in respect of redemption of debentures are to protect the interest of:

1. Debentureholders.
2. Creditors.
3. Shareholders.
4. Bankers.

Premium payable on redemption of debentures is in the nature of:

1. Liability Account.
2. Asset Account.
3. Expense Account.
4. None of these.

Z Ltd. had issued following debentures:

1. 1,00,000, 10% fully convertible debentures of ₹ 100 each on 1st April, 2016 redeemable by conversion after 5 years.
2. 20,000, 10% Debentures of ₹ 100 each redeemable after 4 years, 25% Debentures in Cash and 75% by conversion.

State the amount of DRR required to be created as per the Companies Act, 2013.

Moon Ltd. has 5,000; 10% 0f ₹ 100 each outstanding as on 31st March, 2017. These Debentures are due for redemption on 31st March, 2018. The company has a Debentures Redemption Reserve of ₹ 75,000 on that date. Determine the missing values in the following Journal entries of Moon Ltd.

Strong Ltd. has 10,000; 10% Debentures of ₹ 1,000 each outstanding as on 31st March, 2017. These debentures are due for redemption on 31st March, 2018 at a premium of 10%. Ascertain the missing values in the following Journal of Strong Ltd.

Discuss briefly various methods of redemption of debentures.

IFCI Ltd.(An All India Financial Institution) issued 10,00,000; 9% Debentures of SRCC Ltd. ₹ 50 each on 1st April, 2011 redeemable on 1st April, 2017. How much amount of Debentures Redemption Reserve is required before the redemption of debentures? Also, pass journal entries for issue and redemption of debentures.

Mahima Ltd. issued ₹ 38,00,000, 9% Debentures of ₹ 100 each on 1st April, 2013. The debentures were redeemable at a premium of 5% on 30th June, 2015. The company transferred an amount of ₹ 9,50,000 to Debentures Redemption Reserve on 31st March, 2015. Investments as required by law were made in fixed deposit of a bank on 1st April, 2015.
Ignoring interest on fixed deposit, pass necessary journal entries starting from 31st March, 2015 regarding redemption of debentures.

On 1st April, 2013 the following balances appeared in the books of Blue and Green Ltd:

12%Debentures (Redeemable on 31st August, 2015).	₹ 20,00,000
Debentures Redemption Reserve.	₹ 2,00,000

The company met the requirements of Companies Act, 2013 regarding Debentures Redemption Reserve and Debentures Redemption Investments and redeemed the debentures.
Ignoring interest on investments, pass necessary journal entries for the above transactions in the books of company.

SRCC Ltd. has issued on 1st April, 2016, 20,000, 12% Debentures of ₹ 100 each redeemable by draw of lots as under:

During the year ended on 31st March, 2017	:	15%
During the year ended on 31st March, 2018	:	25%
During the year ended on 31st March, 2019	:	15%
During the year ended on 31st March, 2020	:	25%
During the year ended on 31st March, 2021	:	20%

How much minimum investment or deposit should be made by SRCC Ltd. as per Companies Act, 2013 before redemption of debentures? When should it be made?

Shakti Enterprises Ltd. issued 30,000; 8% Debentures of ₹ 100 each on 1st October, 2014 redeemable in five equal annual instalments starting with 31st March, 2018. The Board decides to transfer to Debentures Redemption Reserve ₹ 50,000 and ₹ 4,00,000 on 31st March 2015 and 2016 respectively and balance required to be transferred to Debentures Redemption Reserve on 31st March, 2017.
Pass journal entries.