Hammer Ltd. Issued 4,000, 10% Debentures of ₹ 100 each, Payable ₹ 20 on application and balance amount on allotment. The debentures are redeemable after 5 yea₹. Application were received for the issued debentures and allotment was made to all the applicants. The amount was received on due dates.
Pass the Journal entries and prepare the Balance Sheet.

Explanation

Note : Debentures are shown as Long-term Borrowings being redeemable after 12 months from the date of Balance Sheet. The period of Operating Cycle is not given hence, it is taken to be period of 12 months.