The following journal entry is recorded in the books of RST Ltd. on issue of debentures: Bank a/c Dr 18,00,000Loss on issue of Debentures a/c Dr 6,00, - Accountancy MCQ CUET Accountancy 2022 20 July Shift 1 2026 | ExamTest.live

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The following journal entry is recorded in the books of RST Ltd. on issue of debentures: Bank a/c Dr 18,00,000Loss on issue of Debentures a/c Dr 6,00,000To 14% Debentures 20,00,000To Premium on Redemption of Debentures 4,00,000Debentures have been issued at a discount of:

Solution & Step-by-step Explanation

Nominal value of Debentures = 20,00,000.Amount received in Bank = 18,00,000.Discount on issue = 20,00,000 - 18,00,000 = 2,00,000.Loss on issue (6,00,000) = Discount on issue (2,00,000) + Premium on redemption (4,00,000).Discount percentage = \frac{2 , 00 , 000}{20 , 00 , 000} \times 100 = 10% .

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The following journal entry is recorded in the books of RST Ltd. on issue of debentures: Bank a/c Dr 18,00,000Loss on issue of Debentures a/c Dr 6,00,000To 14% Debentures 20,00,000To Premium on Redemption of Debentures 4,00,000Debentures have been issued at a discount of:

5%

10%

15%

30%

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