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Ruchi Ltd. Issued 42,000, 7% Debentures of Rs.100 each on 1st April, 2011, redeemable at a premium of 8% on 31st March 2015. The Company decided to cr

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Ruchi Ltd. Issued 42,000, 7% Debentures of Rs.100 each on 1st April, 2011, redeemable at a premium of 8% on 31st March 2015. The Company decided to create required Debenture Redemption Reserve on 31st March 2014. The company invested the funds as required by law in a fixed deposit with State Bank of India on 1st April, 2014 earning interest @10% per annum. Tax was deducted at source by the bak on interest @10%. Pass necessary Journal Entries regarding issue and redemption of debentures.
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Amount transferred to Debenture Redemption Reserve Rs.10,50,000 on 31st March, 2014, Debenture Redemption Investment Rs.6,30,000 on 1st April, 2014, Interest Received Rs.63,000.
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