ABC Ltd. holds 2,000, 15% Debentures of 100 each in XYZ Ltd. as on April 1, 2022 at a cost of 2,50,000. Interest is payable on June, 30 and…

In the Books of ABC Ltd 15% Debentures (Investment) Account Particulars Face Value ₹ Interest ₹ Principal ₹ Particulars Face Value ₹ Interest ₹ Principal ₹ 1.4.22 To Balance b/d 2,00,000 7,500 2,50,000 30.6.22 By Bank A/c 22,500 1.5.22 To Bank A/c 1,00,000 5,000 1,00,000 1.11.22 By Bank A/c 1,20,000 6,000 1,28,200 1.11.22 By P&L A/c 21,800 30.11.22 To Bank A/c 50,000 3,125 54,500 31.12.22 By Bank A/c 90,000 6,750 1,11,250 31.12.22 To P&L A/c 1,250 31.12.22 By Bank A/c 10,500 31.3.23 By Balance c/d 1,40,000 5,250 1,44,500 31.3.23 To P&L A/c (Transfer) 35,375 3,50,000 51,000 4,05,750 3,50,000 51,000 4,05,750 1. Loss on sale of debentures on 1.11.22 Cost = 2,50,000/2,000X 1,200 = 1,50,000 Sale proceeds = 1,28,200 Loss = 1,50,000 less - 1,28,200 = 21,800 2. Profit on sale of debentures on 31.12.22 Cost = 2,50,000/2,000X 800 + 1,00,000/1,000X 100 = 1,10,000 (1,00,000+10,000) Sale proceeds = 1,11,250 Loss = 1,11,250 less - 1,10,000 = 1,250 3. Calculation of closing balance: Units ₹ Debentures in hand remained in hand at 1.4.23 Purchased on 1 st May, 22 900 1,00,000 x 9/10 = 90,000 Purchased on 30 th Nov. 22 500 54,500 1,400 1,44,500