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On 1st April, 2024, Zara… (Class 12 Accountancy 2026, Q19b)

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AccountancyCBSE Class 12 · Board exam 2026, set 67/5/1 · 3 marks · Short answer

CBSE Class 12 Accountancy 2026: question 19(b)

Set in the CBSE Class 12 board exam of 2026, paper 67/5/1, section A, question 19(b), for 3 marks. Try it first; the hints and our step-by-step solution are below.

Q19(b) · 3 marks · Short answerIssue and Redemption of Debentures

On 1st April, 2024, Zara Ltd. issued 8,000, 9% Debentures of ₹ 100 each at a discount of 10%. The company had a balance of ₹ 50,000 in the Securities Premium Account on the same date.
Pass necessary journal entries for the issue of debentures and to write off discount on issue of debentures.

Source: official question paper from cbse.gov.in (PDF). See it in the full 2026 board paper, set 67/5/1.

Hints

Open one hint at a time and try again before the next.

Hint 1

At 10% discount each debenture brings in ₹ 90.

Hint 2

Use Securities Premium first to write off the discount.

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. ParticularsDr. (₹)Cr. (₹)
    Bank A/c Dr.7,20,000
    To Debenture Application and Allotment A/c7,20,000
    (Being money received on 8,000 debentures at ₹ 90, 1st April, 2024)
    1 mark
  2. ParticularsDr. (₹)Cr. (₹)
    Debenture Application and Allotment A/c Dr.7,20,000
    Discount on Issue of Debentures A/c Dr.80,000
    To 9% Debentures A/c8,00,000
    (Being 8,000 9% debentures of ₹ 100 issued at 10% discount)
    1 mark

  3. Discount of ₹ 80,000 is written off first from Securities Premium (₹ 50,000) and the rest (₹ 30,000) from the Statement of Profit and Loss (31st March, 2025).

    ParticularsDr. (₹)Cr. (₹)
    Securities Premium A/c Dr.50,000
    Statement of Profit and Loss Dr.30,000
    To Discount on Issue of Debentures A/c80,000
    (Being discount on issue written off)
    1 mark

Answer: Bank ₹ 7,20,000; Discount ₹ 80,000 with Debentures ₹ 8,00,000; discount written off from Securities Premium ₹ 50,000 and Statement of Profit and Loss ₹ 30,000

Where the marks are

  • Receipt entry (1 mark)
  • Allotment with discount (1 mark)
  • Write-off from Securities Premium then P&L (1 mark)

Revise the chapter

Practise this chapterBoard-style questions from Issue and Redemption of Debentures, one at a time, marked against the answer key and marking points.Back to the full paper2026 board paper, set 67/5/1: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.