Question

On 1st October, 2025, ABC Ltd. issued 2,00,000, 8% Debentures of ₹ 100 each at 10% Discount to be redeemed at 5% Premium at the end of 4 years. Balance in Securities Premium Account is ₹ 10,00,000 and Capital Reserve is 5,00,000. Profit for the year ended 31st March, 2026 before Finance Cost is ₹ 15,00,000. Net Profit or Net Loss for the year is ______.

पर्याय

• ₹ 5,00,000

• Nil

• ₹ 8,00,000

• ₹ 13,00,000

Answer 1

On 1st October, 2025, ABC Ltd. issued 2,00,000, 8% Debentures of ₹ 100 each at 10% Discount to be redeemed at 5% Premium at the end of 4 years. Balance in Securities Premium Account is ₹ 10,00,000 and Capital Reserve is 5,00,000. Profit for the year ended 31st March, 2026 before Finance Cost is ₹ 15,00,000. Net Profit or Net Loss for the year is ₹ 13,00,000.

Explanation:

Loss on Issue of Debentures is ₹ 30,00,000 (₹ 20,00,000 + ₹ 10,00,000). It is written off from

Securities Premium = ₹ 10,00,000 

Statement of Profit & Loss = ₹ 20,00,000 

Loss for the Year = ₹ 5,00,000 (₹ 15,00,000 − ₹ 20,00,000) 

Add: Interest on 8% Debentures = ₹ 8,00,000 

Net Loss for the year = ₹ 13,00,000