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Debentures of Rs. 5,00,000 is issued at a discount of 10% and redeemable at a premium of 10%. What will be the loss on issue of debentures?

Solution

✅ Correct Option: 2

Loss on issue == discount on issue ++ premium payable on redemption =5,00,000×10%+5,00,000×10%=50,000+50,000=Rs. 1,00,000= 5,00,000 \times 10\% + 5,00,000 \times 10\% = 50,000 + 50,000 = Rs.\,1,00,000.

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