Question

Premium on Redemption of Debentures is debited to ______.

Options

• Debentures Account

• Loss on issue of Debentures Account

• Debenture holders’ Account

• Debenture Application and Allotment Account

Answer 1

Premium on Redemption of Debentures is debited to loss on issue of debentures account.

Explanation:

When the company pays a premium to redeem its debentures, that premium is recognized as a loss. This loss is moved to the Loss on Issue of Debenture account.