X Ltd. issued 30,000, 10% Debentures of ₹ 100 each at a discount of 5% on 1st April, 2015. As per the terms of issue , debentures are to be redeemed at the end of five years . Show the amount of discount to be written off from Statement of Profit and Loss every year.

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Solution

$\begin{array}{l} Amount of Discount = 30, 00, 000 \times 5 % = Rs 1, 50,000 \\ Amount of Discount to be written off every year = \frac{1, 50, 000}{5} = Rs 30,000 every year \end{array}$

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X Ltd. issued 30,000, 10% Debentures of ₹ 100 each at a discount of 5% on 1st April, 2015. As per the terms of issue , debentures are to be redeemed at the end of five years . Show the amount of discount to be written off from Statement of Profit and Loss every year.

Amount of Discount=30,00,000×5%=Rs 1,50,000Amount of Discount to be written off every year=1,50,0005=Rs 30,000 every year

$\begin{array}{l} Amount of Discount = 30, 00, 000 \times 5 % = Rs 1, 50,000 \\ Amount of Discount to be written off every year = \frac{1, 50, 000}{5} = Rs 30,000 every year \end{array}$