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When debentures are redeemable at different dates, the total amount of discount on issue of debentures should be written off
  • a)
    Every year by applying the sum of the year’s digit method
  • b)
    Every year by applying the straight line method
  • c)
    To profit and loss account in full in the year of final or last redemption
  • d)
    To profit and loss account in full in the year of first redemption
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
When debentures are redeemable at different dates, the total amount of...
's digits method
b)In the year of the earliest redemption
c)In the year of the latest redemption
d)Equally over the period from the date of issue to the date of the latest redemption.

d)Equally over the period from the date of issue to the date of the latest redemption.

When debentures are redeemable at different dates, the total amount of discount on issue of debentures should be written off equally over the period from the date of issue to the date of the latest redemption. This method is known as the straight-line method of amortization. This ensures that the discount is allocated over the entire period of the debentures and not just in the early years. This method is in accordance with the matching principle of accounting, which requires expenses to be matched with the revenues they help generate.
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When debentures are redeemable at different dates, the total amount of discount on issue of debentures should be written offa)Every year by applying the sum of the year’s digit methodb)Every year by applying the straight line methodc)To profit and loss account in full in the year of final or last redemptiond)To profit and loss account in full in the year of first redemptionCorrect answer is option 'A'. Can you explain this answer?
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When debentures are redeemable at different dates, the total amount of discount on issue of debentures should be written offa)Every year by applying the sum of the year’s digit methodb)Every year by applying the straight line methodc)To profit and loss account in full in the year of final or last redemptiond)To profit and loss account in full in the year of first redemptionCorrect answer is option 'A'. Can you explain this answer? for CA CPT 2024 is part of CA CPT preparation. The Question and answers have been prepared according to the CA CPT exam syllabus. Information about When debentures are redeemable at different dates, the total amount of discount on issue of debentures should be written offa)Every year by applying the sum of the year’s digit methodb)Every year by applying the straight line methodc)To profit and loss account in full in the year of final or last redemptiond)To profit and loss account in full in the year of first redemptionCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA CPT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for When debentures are redeemable at different dates, the total amount of discount on issue of debentures should be written offa)Every year by applying the sum of the year’s digit methodb)Every year by applying the straight line methodc)To profit and loss account in full in the year of final or last redemptiond)To profit and loss account in full in the year of first redemptionCorrect answer is option 'A'. Can you explain this answer?.
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