Question

Discount on issue of debentures is a ______

Options

• revenue loss to be charged in the year of issue.

• capital loss to be written off from capital reserve.

• capital loss to be written off over the tenure of the debentures.

• capital loss to be shown as goodwill.

Answer 1

A discount on the issue of debentures is a capital loss to be written off over the tenure of the debentures.

Explanation:

A discount on debenture issuance is a capital loss that must be written off over the life of the debentures.