XZ Ltd. invited applications for issuing 5000, 9% debentures of ₹100 each. The amount was payable as follows:
On application….. ₹40 per debenture
On allotment….. Balance
Applications for 10,000 debentures were received. Applications for 2,000 debentures were rejected and the application money of these applicants was refunded to them. Pro-rata allotment was made to the remaining applicants. Excess application money received with those applications against which pro-rata allotment was made was adjusted towards amount due on allotment.
Pass the necessary journal entries for the issue of debentures in the books of XZ Ltd.