X Ltd. issued 2,000, 10% debentures of Rs. 100 each at a discount of 8% on April 1, 2025. These debentures are redeemable at par after ten years. The company has a balance in Securities Premium Reserve of Rs. 15,000. Calculate the amount of discount to be written off from the Securities Premium Reserve.

Rs.15,000

Correct answer: Option (1) → Rs.15,000

Concept: Discount/loss on issue of debentures is a capital loss written off against the Securities Premium Reserve (and then the Statement of Profit & Loss), but only to the extent of the balance available in that reserve – see Issue and Redemption of Debentures.

Total discount = 2,000 × 100 × 8% = Rs 16,000.
Balance in Securities Premium Reserve = Rs 15,000.
Amount that can be written off from the Securities Premium Reserve is limited to its balance = Rs 15,000 (the remaining Rs 1,000 is written off from the Statement of Profit & Loss).