Question

Aarav Ltd. issued 10,000, 9% debentures of ₹ 100 each at a premium of 5%, redeemable at a premium of 10%. Loss on issue of debentures account will be debited by ______.

Options

• ₹ 10,00,000

• ₹ 1,00,000

• ₹ 1,50,000

• ₹ 1,05,000

Answer 1

Aarav Ltd. issued 10,000, 9% debentures of ₹ 100 each at a premium of 5%, redeemable at a premium of 10%. Loss on issue of debentures account will be debited by ₹ 1,00,000.

Explanation:

Loss on the issue of debentures = Premium on Redemption of debentures

= 10% of (10,000 × 100)

= ₹ 1,00,000