Question : ‘Discount on issue’ is a ………….. and will be ----------- during the life time of the debentures. But till then it will be shown as --------------’ on the Assets side of the Balance Sheet.

Option 1: Revenue loss, debited, amortized expenditure

Option 2: Capital loss, written off, unamortized expenditure 

Option 3: Revenue loss, profit and loss, fixed assets 

Option 4: Capital loss, written off, amortized expenses

Question :

Intel Ltd. issued 10,000, 7% Debentures of  Rs. 100 each at a discount of 10%. It has Securities Premium Reserve of Rs.1,50,000.Discount on Issue of Debentures, i.e.,  Rs. 1,00,000 will be written off by passing the following entry

Option 1: Securities premium account debited by Rs 1,00,000 and credited discount on issue of debentures account 

Option 2: Debited profit and loss account  and credited discount on issue of debenture account by Rs 1,00,000

Option 3: Debited profit and loss adjustment account and credited discount on issue of debenture account 

Option 4: None  of theses 

Question : Premium on issue of debentures can be used for ________.

Option 1: Issue of partly paid bonus share

Option 2: Writing off losses incurred during the year

Option 3: Writing off discount/loss on issue of debentures

Option 4: Writing off past losses

Question :

Citizen Ltd. issued 10,000, 6% Debentures of  Rs. 100 each at a discount of 10% redeemable at 10% premium. It has Securities Premium Reserve of  Rs. 1,75,000. Loss on Issue of Debentures  Rs. 2,00,000 will be written off by passing the following entry

Option 1: Debited securities premium with Rs 1,75,000 and credited loss on issue of debenture account Rs 1,75,000

Option 2: Debited securities premium reserve account with Rs 1,75,000 and debited surplus in profit and loss account Rs 25,000 and credited loss on issue of debenture account Rs 2,00,000

Option 3: Debited surplus in statement of profit and loss account Rs 2,00,000 and credited loss on issue of debentures account 

Option 4: None of these 

Question : On 1st April 2018, X Ltd. issued 20,000, 10% Debentures of Rs.100 each at a discount of 5% redeemable at a premium of 4% after 5 years. It is decided to write off the loss on the issue of debentures in the year ended 31st March 2019. It has the following balances :
Capital Reserve Rs.1,00,000 and Securities Premium Reserve Rs.50,000.

Question:-  Which of the following statements is correct /true?

Option 1: Discount or Loss on issue may also be written off during the tenure (life) of the debentures either by  Writing off an equal amount each year; or
 

Option 2: Writing off proportionate amount each year

Option 3: Both A and B 

Option 4: None of the above