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BRILLIANT’S Investment Accounting 273

Illustration 3.3.1

On 31st March, 2018 Moon Ltd. purchased ` 2,00,000 6% Government Stock (face value of
` 100 each) at ` 95 each cum-interest. Half-yearly interest is payable on 30th June and 31st
December every year.
Show entries in the investment ledger of Moon Ltd. for its financial year ended on 31st
December, 2018, ignoring income tax and brokerage.
31 ‘mM© 2018 H$mo ‘yZ {b{‘Q>oS> Zo < 95 ‘| H$‘-B§Q>aoñQ> na < 2,00,000 6% JdZ©‘|Q> ñQ>m°H$ (à˶oH$ H$s
< 100 ’o$g d¡ë¶y) IarXm& AY©dm{f©H$ ã¶mO à{V df© 30 OyZ VWm 31 {Xg§~a H$mo ^wJVmZ {H$¶m OmVm h¡&
31 {Xg§~a 2018 H$mo g‘má hþE BgHo$ ’$m¶Z|{e¶b B¶a Ho$ {bE ‘yZ {b{‘Q>oS> Ho$ B§doñQ>‘|Q> boOa ‘| E§Q´>rO Xem©B¶o&
Solution:
In the Books of Moon Ltd.
6% Government Stock Account
Dr. [Interest Payable: 30th June & 31st December] Cr.

Date Particulars Nominal Inter- Cost Date Particulars Nominal Inter- Cost
Value est (`) (`) Value est (`) (`)
2018 2018
Mar. 31 To Bank A/c 2,00,000 3,000 1,87,000 Jun. 30 By Bank A/c - 6,000 -
Dec. 31 To State- Dec. 31 By Bank A/c - 6,000
ment of P&L - 9,000 - By Bal. c/d 2,00,000 - 1,87,000
2,00,000 12,000 1,87,000 2,00,000 12,000 1,87,000

 ` 2,00,000 
On 31st March, 2018 Moon Ltd. purchased 2,000 stock   @ ` 95 cum-interest.
 100 
Total payment was made ` 1,90,000 (` 95 × 2,000) which includes interest accrued upto
31st March, 2018 (i.e. for 3 months - January, February and March).

6 3
The amount of accrued interest = ` 2,00,000 × × = ` 3,000.
100 12
Therefore, cost of investment purchased will be ` 1,90,000 - ` 3,000 = ` 1,87,000.
On 30 June, 2018 interest will be received @ 6% on ` 2,00,000 for the entire 6 months,

6 6
i.e. × ` 2,00,000 × = ` 6,000.
100 12
Again on 31st December 2018 interest will be received @ 6% on ` 2,00,000 for 6 months

6 6
i.e. × ` 2,00,000 × = ` 6,000.
100 12
Net income from interest = ` 6,000 + ` 6,000 - ` 3,000 = ` 9,000 will be credited to Profit and
Loss Account/Statement of Profit and Loss.