When debentures are to be redeemed at premium an extra entry has to be made at the time of issue of ...........

General Accounting Principles Accounting For Debentures

When debentures are to be redeemed at premium an extra entry has to be made at the time of issue of debentures, which a/c should be credited in this entry?

Loss on issue of debentures a/c

Premium on redemption Debenture a/c

Bank a/c

Debenture holder’s a/c

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Explanation:

In this case the debentures are issued at premium. This implies that the company will get more than the face value and at the time of redemption company will return back only the face value. Thus, securities premium will be a gain to the company.