Question

On 1^st May, 2023, Amrit Ltd. issued 10,000, 10% debentures ₹ 100 each at a premium of 10% redeemable at a premium of 10%. Loss on issue of debentures will be ______.

Options

• ₹ 2,00,000

• ₹ 1,30,000

• ₹ 1,00,000

• ₹ 80,000

Answer 1

On 1^st May, 2023, Amrit Ltd. issued 10,000, 10% debentures ₹ 100 each at a premium of 10% redeemable at a premium of 10%. Loss on issue of debentures will be ₹ 1,00,000.

Explanation:

1. Total Debentures Issued: 10,000 debentures of ₹ 100 each.
2. Premium on Redemption: 10% of ₹ 100 = ₹ 10 per debenture.
3. Loss on Issue of Debentures: 
   Loss arises due to the premium paid on redemption.
   Total loss = 10,000 × ₹ 10 = ₹ 1,00,000 

Thus, the Loss on Issue of Debentures = ₹ 1,00,000.