why debenture redemption reserve transfer to general reserve?
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It is transferred in G/R because, DRR is created out of profits of the company & is debited to the statement of P&L(which means profit is reduced). now at the time of redemption of debentures, DRR is transferred to general reserve to give effect to the earlier reduction in profit.
deepak7960:
plese give example
like the company created drr out of profits of the company it is just for showing that the company can bear the loss or we can say, the company is in good condition..it is created because creation of DRR n DRI is legally compulsory, it is only a kind of reserve that is ultimately transferred to general reserve.! um do you understand?
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