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AS 3

Accountancy

Why is discount on issue of debentures is an asset to the company? Video Details ------------- P1 - Advanced Accounting (New) - Without AS AS 3 Cash Flow Statement #8. CF from Financing Activity - Ill - 3

Niveta Rajkumar

CA Inter

★ 3K+

17-Jul-24 18:22

Answers (2)

See, when the liability (debentures) is undertaken at a lower value in order to counter the reduction an asset is required which is discount on debentures which is a fictitious asset

Upashya Das

CA Final

★ 2K+

17-Jul-24 22:41

Discount on issue of debentures is a cost that the company has incurred for the debentures issue. The benefit is available over a period of time. So the discount is recorded as a fictitious asset and written off over the debenture tenure.

CA Suraj Lakhotia

Admin

22-Jul-24 12:48

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