17 October 2013
MrX purchased 1000, 6% Government Bonds of Rs 100 each on 31st January,2009 at Rs95 each.Interest is payable on 30th June and 31st December.The price quoted is cum interest.Journalise the transaction. Purchase Cum interest Cum-int price=1000 Bonds XRs 95=Rs95,000 Interest =1000BondsXRs100 X6%X1/12=Rs500 Ex-Interest Price=Rs95,000-Rs500=Rs94,500 Investment A/c Dr 94,500 (Ex-int) Interest A/c Dr 500 (Int) To Bank A/c 95,000 (Cum-Int)
In the above context: Q1)While calculating Interest why 1 month is taken ?Investment is purchased on 31st January ,so in No of Days interest should be calculated?
17 October 2013
Bonds purchase on 31st jan. And interest is payable on 30th june and 31st dec. We have puchased on jan so we have right to receive on ly for 1 month. Hope u got it.
CAclubindia
