NEB 12 Accounts Share Chapter, Debenture Chapter Theory and OLD is Gold Full Solutions

FEEN TUITION & COACHING

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SECTION 1: CONCEPTUAL BREAKDOWN OF SHARES

In the NEB Accounting curriculum, the Issue of Shares is a high-yield chapter. At FEEN, we define a share as the smallest unit of ownership in a company's total capital. When you buy a share, you are essentially buying a piece of the business.

FEEN PRO-TIP: Always remember that share capital is "Movable Property." It can be transferred from one person to another following the legal guidelines of the company's Articles of Association.

1. Understanding the Hierarchy of Capital

To solve the "Old is Gold" problems, you must understand how capital is classified in the books of accounts:

Capital Type	Core Meaning	Exam Note
Authorized Capital	The maximum amount a company can raise.	Also called Nominal or Registered Capital.
Issued Capital	The part of Authorized Capital offered to public.	Cannot exceed Authorized Capital.
Subscribed Capital	The part of Issued Capital people applied for.	Basis for the Application Money entry.
Called-up Capital	The amount the company has asked to pay.	Crucial for calculating "Calls in Arrears."
Paid-up Capital	The actual cash received in the bank.	Final figure shown in the Balance Sheet.

2. Methods of Issuing Shares

A company can issue shares in three ways, and each has a different accounting treatment at FEEN:

• At Par: Issued at Face Value (e.g., Rs. 100 share for Rs. 100).
• At Premium: Issued above Face Value (e.g., Rs. 100 share for Rs. 110). The extra Rs. 10 is a gain.
• At Discount: Issued below Face Value (e.g., Rs. 100 share for Rs. 90). The Rs. 10 difference is a loss.

3. The Installation Journey

Most companies collect money in stages. As a FEEN student, you must master the sequence: Application → Allotment → First Call → Final Call. Each stage requires two journal entries: one for the "Due" amount and one for the "Receipt" of cash.

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FEEN: ACCOUNTING JOURNAL PROTOCOL

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1. The Share Application Stage

At this stage, the company first receives the money. We do not know who will be allotted shares yet, so we keep the money in a temporary 'Application' account.

Particulars	L.F.	Debit (Rs)	Credit (Rs)
Bank A/c ...................................................... Dr. To Share Application A/c (Being application money received)		XXX
Share Application A/c ............................... Dr. To Share Capital A/c (Being application money transferred to capital)		XXX	XXX

2. The Allotment Stage (The Premium & Discount Zone)

In NEB exams, Premium or Discount is almost always adjusted during Allotment. At FEEN, we teach you to record the 'Due' entry with the adjustment first.

Scenario: Issue at Premium	Debit	Credit
Share Allotment A/c ............................... Dr. To Share Capital A/c (Face Value) To Securities Premium A/c (Extra) (Being allotment money due with premium)	Total	Value Extra

FEEN QUICK HACK: If the question is silent about where to adjust Premium or Discount, ALWAYS adjust it in the Allotment stage. This is the standard practice followed by NEB examiners.

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SECTION 3: PRO-RATA & ADJUSTMENTS

When you encounter Over-subscription, the most critical step is calculating the Excess Application Money. This money isn't just "extra cash"—it's a prepayment for the next stage (Allotment).

1. The FEEN Working Note Table

In your exam, use this table to avoid calculation errors. This is the Full Flex Solution format:

Category	Applied Shares	Allotted Shares	App. Money Received	App. Money Req.	Excess Money	Adjusted to Allotment	Refund
Group A	10,000	10,000	Rs. 20,000	Rs. 20,000	-	-	-
Group B (Pro-rata)	15,000	10,000	Rs. 30,000	Rs. 20,000	Rs. 10,000	Rs. 10,000	-
Group C (Rejected)	2,000	Nil	Rs. 4,000	-	Rs. 4,000	-	Rs. 4,000

FEEN KEY FORMULA:
1. Excess Money = (Applied Shares - Allotted Shares) × Application Rate.
2. Amount Due on Allotment = (Allotted Shares × Allotment Rate) - Excess Adjusted.

2. Accounting for the Excess

The entry to transfer application money changes when pro-rata is involved:

Share Application A/c ................... Dr.
   To Share Capital A/c (Actual Allotted)
   To Share Allotment A/c (Excess Adjusted)
   To Bank A/c (Amount Refunded)

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SECTION 4: FORFEITURE OF SHARES

Forfeiture is the ultimate penalty. When a shareholder fails to meet their financial obligation, the company takes back the shares and keeps the money already paid. At FEEN, we simplify the complex journal entry for this process.

Scenario 1: Shares originally issued at PAR

Share Capital A/c .................... Dr. (Called-up Value)
To Share Forfeiture A/c (Amount ALREADY Paid)
To Share Allotment A/c (Unpaid Amount)
To Share Call A/c (Unpaid Amount)
/* Being shares forfeited for non-payment */

Scenario 2: Shares originally issued at PREMIUM

This is where students get confused. FEEN Rule: If the premium was ALREADY received, ignore it. If the premium was NOT received, you must debit it during forfeiture.

Share Capital A/c .................... Dr. (Called-up Value)
Securities Premium A/c ............... Dr. (Unpaid Premium)
To Share Forfeiture A/c (Amount Paid excluding premium)
To Calls in Arrears A/c (Total Unpaid)

THE FEEN GOLDEN RULE: In the Share Capital A/c (Debit), always use the CALLED-UP amount (the amount the company has asked for until the point of forfeiture), not the Face Value or Paid-up Value.

Term	Meaning in Forfeiture
Called-up	Amount demanded by the company.
Forfeiture A/c	Profit for the company (seized money).
Arrears	The "bad debt" we are closing.

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SECTION 5: RE-ISSUE & CAPITAL RESERVE

Once shares are forfeited, the company effectively "owns" the money the previous shareholder paid. When these shares are sold again, we need to finalize the profit. At FEEN, we break this into two final steps.

1. Journal Entry for Re-issue

If the shares are re-issued at a discount, we use the Share Forfeiture A/c to cover that loss.

Bank A/c .......................... Dr. (Actual Cash Received)
Share Forfeiture A/c .............. Dr. (Discount Allowed)
To Share Capital A/c (Face Value)

2. Transfer to Capital Reserve

This is the final "Net Profit" from the whole forfeiture and re-issue cycle. It is a mandatory entry in every NEB long question.

Share Forfeiture A/c .............. Dr.
To Capital Reserve A/c
(Being balance of forfeiture account transferred to capital reserve)

FEEN MATHEMATICAL CHECK:

Capital Reserve = (Total Amount Forfeited) - (Discount on Re-issue)

*Note: If only a part of forfeited shares are re-issued, you must calculate the proportional forfeiture amount first!

Congratulations! You have completed the FEEN Theoretical Foundation for Share Capital. You are now equipped with the knowledge of Par, Premium, Discount, Pro-rata, Forfeiture, and Re-issue.

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SECTION 6: NEB 2081 SOLUTION

Problem: Issue of 15,000 shares at 10% Discount with Pro-rata adjustment.

FULL FLEX JOURNAL ENTRIES

Particulars	LF	Debit (Rs)	Credit (Rs)
Bank A/c .......................................... Dr. To Share Application A/c (25,000 shares × Rs. 20)		5,00,000	5,00,000
Share Application A/c ................... Dr. To Share Capital A/c (15,000 × 20) To Share Allotment A/c (Excess) To Bank A/c (Refund)		5,00,000	3,00,000 1,00,000 1,00,000
Share Allotment A/c ..................... Dr. (15,000 × 40) Discount on Issue A/c ................. Dr. (15,000 × 10) To Share Capital A/c (15,000 × 50)		6,00,000 1,50,000	7,50,000
Bank A/c .......................................... Dr. To Share Allotment A/c (Due 6,00,000 - 1,00,000 already adjusted)		5,00,000	5,00,000
Share First & Final Call A/c ....... Dr. (15,000 × 30) To Share Capital A/c		4,50,000	4,50,000
Bank A/c .......................................... Dr. Calls in Arrears A/c ...................... Dr. (500 × 30) To Share First & Final Call A/c		4,35,000 15,000	4,50,000

FEEN NOTE: In the final entry, we subtract the arrears (500 shares × Rs. 30 = Rs. 15,000) from the total due to find the actual cash received.

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SECTION 7: OLD IS GOLD (2080 & 2079)

NEB 2080 GIE SET A SOLUTION

Solving for 5,000 shares issued at Par with Pro-rata adjustment.

Journal Entries	LF	Debit (Rs)	Credit (Rs)
Bank A/c .......................................... Dr. To Share Application A/c (Being app. money received on 9,000 shares)		1,80,000	1,80,000
Share Application A/c ................... Dr. To Share Capital A/c (5,000 × 20) To Share Allotment A/c (Excess) To Bank A/c (Refund)		1,80,000	1,00,000 40,000 40,000
Share Allotment A/c ..................... Dr. To Share Capital A/c (5,000 × 50)		2,50,000	2,50,000
Bank A/c .......................................... Dr. To Share Allotment A/c (Rs. 2,50,000 - 40,000 adjusted)		2,10,000	2,10,000
Share First & Final Call A/c ....... Dr. To Share Capital A/c (5,000 × 30)		1,50,000	1,50,000
Bank A/c .......................................... Dr. Calls in Arrears A/c ...................... Dr. (500 × 30) To Share First & Final Call A/c		1,35,000 15,000	1,50,000

FEEN MASTER TIP: In 2079 exams, NEB often asked for Issue at Premium. Remember, Share Premium is always credited in the "Due" entry of Allotment unless specified otherwise. [cite: 12829]

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SECTION 8: NEB 2078 PREMIUM SOLUTION

FEEN CALCULATION ALERT:
1. Total Due on Allotment (20,000 × 50) = Rs. 10,00,000
2. Less: Excess Application Adjusted = Rs. 3,00,000
3. Net Due from Allotment = Rs. 7,00,000
4. Arrears on 400 shares = (400 × 50) - Pro-rata excess of those 400 shares.

Journal Entries	LF	Debit (Rs)	Credit (Rs)
Bank A/c .......................................... Dr. To Share Application A/c		10,50,000	10,50,000
Share Application A/c ................... Dr. To Share Capital A/c (20,000 × 30) To Share Allotment A/c (Excess) To Bank A/c (Refund)		10,50,000	6,00,000 3,00,000 1,50,000
Share Allotment A/c ..................... Dr. To Share Capital A/c (20,000 × 40) To Securities Premium A/c (20,000 × 10)		10,00,000	8,00,000 2,00,000
Bank A/c .......................................... Dr. Calls in Arrears A/c ...................... Dr. To Share Allotment A/c (Being allotment money received except for 400 shares)		6,86,000 14,000	7,00,000

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SECTION 9: NEB 2077 SOLUTIONS

FEEN CRITICAL LOGIC: If a shareholder APPLIED for 300 shares, you must find how many were ALLOTTED to him before calculating arrears!
Formula: (Total Allotted / Total Applied) * Applied by person
Calculation: (10,000 / 15,000) * 300 = 200 shares.

Journal Entries	LF	Debit (Rs)	Credit (Rs)
Bank A/c .......................................... Dr. To Share Application A/c		4,50,000	4,50,000
Share Application A/c ................... Dr. To Share Capital A/c (10k * 30) To Share Allotment A/c (Excess)		4,50,000	3,00,000 1,50,000
Share Allotment A/c ..................... Dr. To Share Capital A/c		4,00,000	4,00,000
Bank A/c .......................................... Dr. Calls in Arrears A/c ...................... Dr. To Share Allotment A/c (Due 4,00,000 - 1,50,000 Adjusted = 2,50,000)		2,45,000 5,000	2,50,000

Arrears Note: The 200 shares owner owed Rs. 8,000 on allotment, but he had already paid Rs. 3,000 extra during application. So, actual arrears = Rs. 5,000.

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SECTION 10: NEB 2075 SOLUTIONS

FEEN WORKING NOTE (Arrears):
1. Shares Allotted to Defaulter = 400
2. Shares Applied by him = (15,000/10,000) * 400 = 600
3. Excess paid on App. = (600 - 400) * 30 = Rs. 6,000
4. Total Allotment Due = 400 * 40 = Rs. 16,000
5. Actual Allotment Arrears = 16,000 - 6,000 = Rs. 10,000

Particulars	LF	Debit (Rs)	Credit (Rs)
Bank A/c .......................................... Dr. To Share Application A/c		9,00,000	9,00,000
Share Application A/c ................... Dr. To Share Capital A/c To Share Allotment A/c To Bank A/c		9,00,000	6,00,000 1,50,000 1,50,000
Share Allotment A/c ..................... Dr. To Share Capital A/c		8,00,000	8,00,000
Bank A/c .......................................... Dr. Calls in Arrears A/c ...................... Dr. To Share Allotment A/c (8,00,000 - 1,50,000 Adjusted = 6,50,000 Due)		6,40,000 10,000	6,50,000

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FEEN MASTERY

TIPS • HINTS • HACKS

SECTION 11: THE EXAM SURVIVAL GUIDE

HACK #1

The Pro-rata Short-cut: When calculating Amount Received on Allotment, always use this FEEN sequence:
(Total Allotted × Allotment Rate) - Total Excess from Application - Arrears. Never try to calculate individual categories in the journal; do it in the working note first!

HACK #2

The Forfeiture Calculation: In the Share Forfeiture Account (Credit), you only record the money the company ACTUALLY KEPT. This excludes any premium that was already received. If a share is Rs. 100 and the person paid Rs. 40, the forfeiture is Rs. 40. Simple.

HACK #3

The Capital Reserve Trap: If the company forfeits 1,000 shares but only re-issues 600 shares, you cannot transfer the whole balance to Capital Reserve.
Formula: (Total Forfeited Amount / Forfeited Shares) × Re-issued Shares - Re-issue Discount.

HACK #4

Time Management: The "Issue of Shares" long question should take you exactly 12-15 minutes. Spend 5 minutes on the Pro-rata table and 10 minutes on Journals. If your table is correct, the journals will flow naturally.

FINAL WORD FROM FEEN: Accuracy in the first two entries (Application) determines the success of the remaining eight. Double-check your multiplication!

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FEEN: FORFEITURE & REISSUE THEORY

1. Forfeiture Entry (At Par)

Share Capital A/c .................... Dr. (Called-up)
  To Share Forfeiture A/c (Paid-up)
  To Calls in Arrears A/c (Unpaid)

2. Reissue Entry (At Discount)

Bank A/c ............................. Dr. (Actual Cash)
Share Forfeiture A/c ................. Dr. (Discount)
  To Share Capital A/c (Face Value)

3. Capital Reserve Entry

Share Forfeiture A/c ................. Dr.
  To Capital Reserve A/c

FEEN: FORFEITURE & REISSUE THEORY

1. Forfeiture Entry (At Par)

Share Capital A/c .................... Dr. (Called-up)
  To Share Forfeiture A/c (Paid-up)
  To Calls in Arrears A/c (Unpaid)

2. Reissue Entry (At Discount)

Bank A/c ............................. Dr. (Actual Cash)
Share Forfeiture A/c ................. Dr. (Discount)
  To Share Capital A/c (Face Value)

3. Capital Reserve Entry

Share Forfeiture A/c ................. Dr.
  To Capital Reserve A/c

SECTION 4-6: OLD IS GOLD SOLUTIONS

Q1 (2081): 500 Shares Forfeited
1. Capital A/c Dr. (500*80) = 40,000
2. Arrears Cr. (500*30) = 15,000
3. Forfeiture Cr. (Balancing) = 25,000
Reissue: Bank Dr. (500*70) | Forfeiture Dr. (500*30) | Capital Cr. (500*100)

Q2 (2080): Proportional Transfer
Forfeited amount per share = Rs. 80.
On reissue of 150 shares: Profit = 150 * 80 = 12,000.
Discount on reissue = 150 * 10 = 1,500.
Transfer to Reserve: 12,000 - 1,500 = 10,500.

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FORFEITURE & REISSUE THEORY

1. The Forfeiture Entry

Share Capital A/c .................... Dr. [Called-up Amount]
To Share Forfeiture A/c [Amount Paid]
To Calls in Arrears A/c [Amount Unpaid]

2. Reissue at Discount

Bank A/c ............................. Dr. [Actual Cash]
Share Forfeiture A/c ................. Dr. [Discount Loss]
To Share Capital A/c [Face Value]

3. Transfer to Capital Reserve

Share Forfeiture A/c ................. Dr. [Net Profit]
To Capital Reserve A/c

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OLD IS GOLD SOLUTIONS (SECTION 4-6)

Q1: NEB 2081 Solution

Amount Forfeited: 300 × Rs. 70 = Rs. 21,000
Discount on Reissue: 300 × Rs. 20 = Rs. 6,000
Net to Capital Reserve: Rs. 15,000

Q2: NEB 2080 Solution

Amount Forfeited: 200 × Rs. 50 = Rs. 10,000
Discount on Reissue: 200 × Rs. 10 = Rs. 2,000
Net to Capital Reserve: Rs. 8,000

Q3: NEB 2079 (Partial Reissue)

Forfeited per share: Rs. 80
Proportional Forfeiture for 300 shares: Rs. 24,000
Discount on 300 shares: Rs. 9,000
Net to Capital Reserve: Rs. 15,000

FEEN EDUCATION NETWORK

SHARES FOR OTHER THAN CASH (THEORY)

At FEEN, we simplify this chapter into two easy steps. When a company buys an asset and pays with shares, it is effectively a "barter" system in the corporate world.

Step 1: Purchase of Assets

Sundry Assets A/c .................... Dr.
To Vendor's A/c
(Being assets purchased from vendor)

Step 2: Issue of Shares (At Par)

Vendor's A/c ......................... Dr.
To Share Capital A/c
(Being shares issued to vendor)

FEEN MASTER FORMULA:
No. of Shares = Purchase Consideration / Issue Price

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SECTION 2: NEB 2081 SOLVED

Working Note:
Total Amount = Rs. 4,50,000
Issue Price = 100 + 25 = 125
Shares = 4,50,000 / 125 = 3,600 Shares.

Particulars	Debit (Rs)	Credit (Rs)
Machinery A/c ................ Dr. To X Company A/c	4,50,000	4,50,000
X Company A/c ............... Dr. To Share Capital A/c (3600*100) To Securities Premium A/c (3600*25)	4,50,000	3,60,000 90,000

BUSINESS PURCHASE & SHARES

At FEEN, we simplify the "Business Takeover" logic. You are simply recording what comes in (Assets) and what goes out (Liabilities + Shares).

THE FEEN BALANCE RULE:
• If Assets < (Liabilities + PC) → Debit Goodwill
• If Assets > (Liabilities + PC) → Credit Capital Reserve

Assets A/c (Individual) ............ Dr.
[Goodwill A/c] ..................... Dr.
To Liabilities A/c
To Vendor A/c (PC)
[To Capital Reserve A/c]

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SECTION 3: NEB 2080 SOLVED

Working: Shares = 4,80,000 / 96 = 5,000 Shares.

Journal Entry	Dr.	Cr.
Assets A/c ................... Dr. To Liabilities A/c To Vendor A/c To Capital Reserve A/c	6,00,000	1,00,000 4,80,000 20,000
Vendor A/c ................... Dr. Discount on Issue A/c ........ Dr. To Share Capital A/c	4,80,000 20,000	5,00,000

SECTION 4: NEB 2079 SOLVED

FEEN WORKING NOTE:
• Assets Purchased: Building (Rs. 8,00,000)
• Issue Price: Rs. 125 (100 + 25%)
• Calculation: 8,00,000 ÷ 125 = 6,400 Shares.

Building A/c .......................... Dr. 8,00,000
To Vendor's A/c ........................ 8,00,000

Vendor's A/c .......................... Dr. 8,00,000
To Share Capital A/c (6400*100) ........ 6,40,000
To Securities Premium A/c (6400*25) .... 1,60,000

SECTION 5: NEB 2078 SOLVED

FEEN WORKING NOTE:
• Issue Price: Rs. 90 (100 - 10%)
• Calculation: 2,70,000 ÷ 90 = 3,000 Shares.

Furniture A/c ......................... Dr. 2,70,000
To Vendor's A/c ........................ 2,70,000

Vendor's A/c .......................... Dr. 2,70,000
Discount on Issue A/c ................. Dr. 30,000
To Share Capital A/c (3000*100) ........ 3,00,000

SECTION 6: NEB 2077 BUSINESS PURCHASE

FEEN CRITICAL ALERT:
Since PC + Liabilities (5.3L) is greater than Assets (5L), we must debit Goodwill for the difference of Rs. 30,000.

Sundry Assets A/c ..................... Dr. 5,00,000
Goodwill A/c (Bal. Fig) ............... Dr. 30,000
To Sundry Liabilities A/c .............. 50,000
To Vendor's A/c ........................ 4,80,000

Vendor's A/c .......................... Dr. 4,80,000
To Share Capital A/c ................... 4,80,000

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FORFEITURE & REISSUE THEORY

1. The Forfeiture Entry

Share Capital A/c .................... Dr. [Called-up Amount]
To Share Forfeiture A/c [Amount Paid]
To Calls in Arrears A/c [Amount Unpaid]

2. Reissue at Discount

Bank A/c ............................. Dr. [Actual Cash]
Share Forfeiture A/c ................. Dr. [Discount Loss]
To Share Capital A/c [Face Value]

3. Transfer to Capital Reserve

Share Forfeiture A/c ................. Dr. [Net Profit]
To Capital Reserve A/c

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OLD IS GOLD SOLUTIONS (SECTION 4-6)

Q1: NEB 2081 Solution

Amount Forfeited: 300 × Rs. 70 = Rs. 21,000
Discount on Reissue: 300 × Rs. 20 = Rs. 6,000
Net to Capital Reserve: Rs. 15,000

Q2: NEB 2080 Solution

Amount Forfeited: 200 × Rs. 50 = Rs. 10,000
Discount on Reissue: 200 × Rs. 10 = Rs. 2,000
Net to Capital Reserve: Rs. 8,000

Q3: NEB 2079 (Partial Reissue)

Forfeited per share: Rs. 80
Proportional Forfeiture for 300 shares: Rs. 24,000
Discount on 300 shares: Rs. 9,000
Net to Capital Reserve: Rs. 15,000

FEEN EDUCATION NETWORK

ISSUE OF DEBENTURES (THEORY)

FEEN PRO-TIP: Always remember that Debenture Interest is a "Charge against Profit." It MUST be paid regardless of profit or loss.

Basic Journal Entries (Issue at Par)

Bank A/c .............................. Dr.
To Debenture Application A/c

Debenture Application A/c ............. Dr.
To ...% Debentures A/c

Issue at Discount

Debenture Allotment A/c ............... Dr.
Discount on Issue A/c ................. Dr.
To ...% Debentures A/c

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SECTION 6: NEB 2081 SOLVED

FEEN WORKING NOTE:
• Cash Received: 2,000 * 950 = Rs. 19,00,000
• Total Loss: (Discount 50 + Premium 100) * 2,000 = Rs. 3,00,000

Particulars	Debit (Rs)	Credit (Rs)
Bank A/c ............................ Dr. To Debenture Application & Allotment A/c	19,00,000	19,00,000
Debenture App. & Allot. A/c .......... Dr. Loss on Issue of Debentures A/c ...... Dr. To 10% Debentures A/c To Premium on Redemption A/c	19,00,000 3,00,000	20,00,000 2,00,000

REDEMPTION & LOSS ON ISSUE

At FEEN, we teach you to be "Prudent." If a company knows it will pay a premium in 5 years, it must show that loss in the books TODAY.

FEEN MASTER RULE:
Total Loss on Issue = Discount on Issue + Premium on Redemption

Master Entry: Issue at Discount & Redeem at Premium

Bank A/c .............................. Dr. [Cash Received]
Loss on Issue of Debentures A/c ....... Dr. [Disc + Prem]
To ...% Debentures A/c [Face Value]
To Premium on Redemption A/c [Prem Only]

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SECTION 7: NEB 2080 SOLVED

Working Note:
Total Premium on Redemption = 4,000 * 10 = 40,000 (Loss)
Total Securities Premium = 4,000 * 5 = 20,000 (Gain)

Journal Entry	Dr.	Cr.
Bank A/c ............................ Dr. To Debenture App. & Allot. A/c	4,20,000	4,20,000
Debenture App. & Allot. A/c .......... Dr. Loss on Issue of Debentures A/c ...... Dr. To 12% Debentures A/c To Securities Premium A/c To Premium on Redemption A/c	4,20,000 40,000	4,00,000 20,000 40,000

SECTION 8: NEB 2079 SOLVED

FEEN WORKING NOTE:
• Cash Received: 5,000 * 95 = Rs. 4,75,000
• Discount: 5,000 * 5 = Rs. 25,000

Bank A/c .............................. Dr. 4,75,000
To Debenture App. & Allot. A/c .......... 4,75,000

Debenture App. & Allot. A/c .......... Dr. 4,75,000
Discount on Issue A/c ................. Dr. 25,000
To 10% Debentures A/c .................. 5,00,000

SECTION 9: NEB 2078 SOLVED

FEEN WORKING NOTE:
• Redemption Premium: 15,00,000 * 5% = Rs. 75,000
• This amount is debited as "Loss on Issue" and credited as "Premium on Redemption."

Bank A/c .............................. Dr. 15,00,000
To Debenture App. & Allot. A/c .......... 15,00,000

Debenture App. & Allot. A/c .......... Dr. 15,00,000
Loss on Issue of Debentures A/c ....... Dr. 75,000
To 12% Debentures A/c .................. 15,00,000
To Premium on Redemption A/c ........... 75,000

SECTION 10: NEB 2077 SOLVED

FEEN WORKING NOTE:
• Cash Inflow: 1,000 * 1100 = Rs. 11,00,000
• Securities Premium: Rs. 1,00,000 (Credit - Income)

Bank A/c .............................. Dr. 11,00,000
To Debenture App. & Allot. A/c .......... 11,00,000

Debenture App. & Allot. A/c .......... Dr. 11,00,000
To 5% Debentures A/c ................... 10,00,000
To Securities Premium A/c .............. 1,00,000

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