Accounts Shares, Debenture

Format of Balance Sheet

Some Major Points

• Oversubscription starts at the time of applications and also ends at the time of applications and there is further no use of this amount.
• When the ques.is silent about sec.prem./discount wheather it is on applications or allotment then allotment journal will be prefered
• Calculations at the time of pro rata excess amt.paid at the time of applications no. Of shares for not paid total no.of shares
• It should be noted that if cash book is asked in ques,then there is no need to pass cash/bank journal entries in ques.
• The word `equity` &`% pref.shares`is must be write before the word `shares`
• S.E.B.I. Means “SECURTIES & EXCHANGE BOARD OF INDIA”

Meaning of Debenture
When the company requires funds on long term basis then company raise their capital by issue of shares or may borrow money for long term. Sometime long term money is borrowed by issuing debenture on the same way as issuing shares.

Debenture is the acknowledgement of the debt given under the seal of the company and containing a contract for the repayment of the principal sum at the specified date and the payment of the interest at the fixed rate %until the principal sum is repaid.

According to sec 2 (12) of the company act, “debentures includes debenture,stock,bonds & any other securities of the company, whether constituting a charge on the assets of the company ir not

Types of Debenture

Q. DIFF. B/W Shares & Debenture.