Veer Ltd. issued Rs. 2,00,000, 6% debentures at 10% discount redeemable after 5 years at 5% premium. Calculate the amount to be debited to loss on issue of debentures account.

Amount received on issue = Rs. 1,80,000 Amount on redemption = Rs. 2,10,000 Thus, loss = 2,10,000 - 1,80,000 = Rs. 30,000 Option (2) is incorrect because it is applicable if only loss on issue of Rs. 20,000 is considered and Rs. 10,000 premium on redemption is ignored. Option (3) is incorrect because it is applicable only if loss Rs. 10,000 for premium on redemption is considered and Rs. 20,000 discount on issue is ignored. Option (4) is incorrect because it is applicable if loss on issue of Rs. 20,000 and Rs. 10,000 premium on redemption are ignored.