On 1st April, 2013, Rayon Ltd. issued 2,000, 9% Debentures of? 100 each at a discount of 10%. redeemable at par on 31st March, 2017. The issue was fully subscribed. To meet the provisions of the Companies Act, 2013, the Board of Directors decided to transfer ? 30,000 to Debenture Redemption Reserve on 31st March, 2014 and the balance on 31st March, 2015. On 1st April 2016, the company made the required investment in government securities.
The investments were encased and the debentures were redeemed on the due date. It is the policy of the company to wTite off capital losses in the year in which they occur.
You are required to pass journal entries for issue and redemption of debentures (ignore interest on debentures).