Company Accounts

Debentures

Easy

common

9% Debentures of Rs. 100 each are issued at 5% discount and redeemable at 8% premium, which of the following account will be credited, at the time of issue?

Premium on redemption of debenture account

Discount on issue of debenture account

Loss on issue of debenture account

Securities premium account

✅ Correct Option: 1

The issue entry is: Debenture Application and Allotment A/c Dr. 95, Loss on Issue of Debentures A/c Dr. 13, To Debentures A/c 100, To Premium on Redemption of Debentures A/c 8.

Discount and Loss on Issue are debited as they are losses. The redemption premium is a liability payable in future, so Premium on Redemption of Debentures A/c is credited.

2025: 30 May Shift 2

Match List-I with List-II

List-I	List-II
Type of Debenture	Explanation
(A) Secured Debentures	(I) These debentures do not have a specific charge on the assets of the company.
(B) Irredeemable Debentures	(II) These debentures are those which are payable on the expiry of the specific period either in lump sum or in installments during the lifetime of the company.
(C) Unsecured Debentures	(III) It refers to those debentures where a charge is created on the assets of the company for the purpose of payment in case of default.
(D) Redeemable Debentures	(IV) These debentures are repayable on the winding-up of a company or on the expiry of a long period.

Choose the correct answer from the options given below:

2026: 12 May Shift 1

ICT Co. Ltd. purchased assets worth Rs. 28,80,000. It issued debentures of Rs. 100 each at a discount of 4 per cent in full satisfaction of the purchase consideration. The number of debentures issued to vendor is:

2022: 30 Aug Shift 2

When debentures are issued at premium with the term of redeeming them at par. The amount of premium received at the time of issue will be:

2023: 11 June Shift 3

How much amount is to be debited in statement of profit and Loss to write off loss on Issue of Debentures ?

2022: 20 Aug Shift 2

Which A/c is credited for transfer of interest on Debenture Redemption Fund Investment?

2025: 14 May Shift 2

Number of debentures issued are :

9% Debentures of Rs. 100 each are issued at 5% discount and redeemable at 8% premium, which of the following account will be credited, at the time of issue?

Solution

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