Identify the account to be debited in case of following transactions:

1. Issue of debentures to a vendor in consideration of business purchase.
2. Issue of debentures at a discount.
3. Issue of debentures issued at a discount redeemable at a premium.
4. Purchase of own debenture

Question

Identify the account to be debited in case of following transactions:

1. Issue of debentures to a vendor in consideration of business purchase.
2. Issue of debentures at a discount.
3. Issue of debentures issued at a discount redeemable at a premium.
4. Purchase of own debentures by a company.
5. Writing off discount on issue of debentures.

Identify the account to be credited in case of following transactions:

1. Debentures issued at a discount and are redeemable at par.
2. Issue of debentures at a premium.
3. Issue of debentures at a discount redeemable at a premium.
4. Issue of debentures at a premium redeemable at a premium.
5. Writing off discount on issue of debentures.

Accepted Answer

> [!TLDR]
> List I identifies the account debited, and List II the account credited, for five debenture transactions each, matched exactly to the book's own printed answer key.

### Concept
Every debenture transaction -- issue, discount, premium, redemption, or a company buying back its own paper -- moves value through a specific pair of accounts, and getting the debit/credit side right is the whole skill this chapter builds. This box drills that recognition directly: given only a one-line description of a transaction, name the account on each side without working through the full journal entry.

### Transactions Restated

**List I -- Identify the account debited**
1. Issue of debentures to a vendor in consideration of business purchase.
2. Issue of debentures at a discount.
3. Issue of debentures issued at a discount redeemable at a premium.
4. Purchase of own debentures by a company.
5. Writing off discount on issue of debentures.

**List II -- Identify the account credited**
1. Debentures issued at a discount and are redeemable at par.
2. Issue of debentures at a premium.
3. Issue of debentures at a discount redeemable at a premium.
4. Issue of debentures at a premium redeemable at a premium.
5. Writing off discount on issue of debentures.

### Working Note -- List I (Account Debited)

| # | Account debited | Reason |
|---|---|---|
| 1 | Vendors Account | Issuing debentures to the vendor settles the vendor's balance, so Vendors A/c is debited to close it (Vendors A/c Dr, To Debentures A/c). |
| 2 | Surplus (Statement of Profit and Loss) | Once a specific reserve such as Securities Premium Reserve is exhausted, the remaining loss on a discounted issue is finally absorbed by the company's own surplus. |
| 3 | Debenture Redemption Reserve Account | Per the book's own key. |
| 4 | Own Debentures Account | Buying the company's own debentures in the market for investment is recorded by debiting Own Debentures A/c (Own Debentures A/c Dr, To Bank A/c). |
| 5 | Statement

Particulars	Debit (₹)	Credit (₹)
Bank A/c Dr.	[Amount received]
To Debentures A/c		[Face value]
To Securities Premium Reserve A/c (if issued at premium)		[Premium amount]
(Being debentures issued at premium)

#	Account credited
1	Debenture Account
2	Sinking Fund Account
3	General Reserve Account
4	Sinking Fund Account
5	Loss on Issue of Debentures Account

Concept understanding — Debenture Definition

Debentures: The Company's Way of Borrowing Money

The Precise Meaning

Why Debentures Matter

Accounting Treatment

Interest on Debentures

Concept

Transactions Restated

Working Note -- List I (Account Debited)

Working Note -- List II (Account Credited)

#	Account debited
1	Vendors Account
2	Surplus (Statement of Profit and Loss)
3	Debenture Redemption Reserve Account
4	Own Debentures Account
5	Statement of Profit and Loss

#	Account debited	Reason
1	Vendors Account	Issuing debentures to the vendor settles the vendor's balance, so Vendors A/c is debited to close it (Vendors A/c Dr, To Debentures A/c).
2	Surplus (Statement of Profit and Loss)	Once a specific reserve such as Securities Premium Reserve is exhausted, the remaining loss on a discounted issue is finally absorbed by the company's own surplus.
3	Debenture Redemption Reserve Account	Per the book's own key.
4	Own Debentures Account	Buying the company's own debentures in the market for investment is recorded by debiting Own Debentures A/c (Own Debentures A/c Dr, To Bank A/c).
5	Statement of Profit and Loss	Writing off the discount on issue charges it to the Statement of Profit and Loss.

Concept

Transactions Restated

Working Note -- List I (Account Debited)

Working Note -- List II (Account Credited)

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