Adwitya Ltd. issued Rs. 20,000 15% debentures at a discount of 10%, redeemable after 15 year
at a premium of 5%. Loss on issue of debentures will be
(a) Rs. 2,000
(b) Rs. 1,000
(c) Rs. 3,000
(d) None of the above
Answers
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0
Answer:
2000
Explanation:
premium not treated as a loss initially..
kaavyasingh:
but the answer in my book is 3000 and there's no explanation how the answer is 3000
I think they not asking about journal entry.. they ask how much total financial leverage organization should bear if he take fund by issue of debeture... so the rest one thousand is also loss to a organisation but its come to P&L acc when debenture have redeemed.... so overall loss is 3000.... to issue of a debenture..
1000 is a premium loss
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