To P & L Alc 563 563 45,000 45,000 45,000 563 45,000 i4 Debenture Interest Account 2012 2012 Mar 31 To Bank (on 1,25,000 3,125 Jan. By Accrued Interest 1,875 @ 5% for 6 months) (on 1,50.000 @ 5% for 3 months) To Interest on own 625 Dec 31 By P&L A/C 7,500 Debentures Sep 30 To Bank (on 1,05,000 @ 5% for 6 months) 2,625 To Interest on own Debentures 1,125 Dec. 31 To Interest accrued on 1,05,000 for 3 months) 1,312 To Interest on own debentures (on 345,000 for 3 months) 563 9.375 2013 2013 Mar 31 To Bank (on 1,05,000 for 2,625 Jan. 1 By Interest Accrued 6 months) To Interest on own Mar. 31 By P&L A/C debentures (on 345,000 for 3 563 months) 9.375 1,312 1,876 3,188 3.188 Illustration 4 Hindustan Ltd., issued 50,000, 6% Debentures of 100 each on 1st January, 2009. The debentures are redeemable by the creation of a Debenture Redemption Reserve. The company had the right to call upon the Trustee to apply the Debenture Redemption Reserve monies in purchasing own debentures, if available below par. The following information is given: (a) The annual appropriation is 750,000. (b) Debenture Redemption Reserve Balance as on 1st January, 2012 was 1,31,942 represented by 6% State Loan at cost of 74,262 (face value 780,000) and Debenture Redemption Reserve cash 7 56,830. This cash balance which includes the annual appropriation of 750,000 was invested in 6% State Loan, The Loan bond, purchased cum interest, had a face value of 60,000. (c) 1st September, 2012 sold the State Loan of the face value 7 40,000 out of loan held on 1st January, 2012 738,000 (ex-interest) and the proceeds were applied in purchasing own debentures (face value? 45,000 ex-interest). (d) The debentures purchased are cancelled on 31st December (e) Interest on State Loan is received on 31st March and 30th September (0 Interest on debentures is paid on 30th June and 31st December (g) Debentures outstanding as on 1st January, 2012 were 74,67,000. Make ledger entries in the books of the company to give effect to the above