Question

Discount on issue of debentures is recorded in the form of

(A) Intangible Asset

(B) Current Asset

(C) Current Liabilities

(D) Miscellaneous Expenditure

Answer 1

Correct option is: (D) Miscellaneous Expenditure

Discount on issue of debentures is a capital loss to be written off over a period of time depending upon the terms of issue, before the redemption of such debentures. The loss is recorded under the head of miscellaneous expenditure in balance sheet on asset side.