Arrange the following in order in case of issue of debenture at discount.
A. Allotment due
B. Receipt of application money
C. Transfer of discount to Statement of Profit & Loss
D. Allotment of debentures
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → B, D, A, C
Debentures issued at a discount and payable on application and allotment are recorded in this order:
B. Receipt of application money
D. Allotment of debentures (the application money is transferred to the Debentures Account)
A. Allotment money due, with the discount debited to Discount on Issue of Debentures Account
C. Transfer of the discount to the Statement of Profit & Loss, where it is written off
Note: In the original question, both Option (1) and Option (3) were correct as per the NTA Answer Key. The paper printed Option (1) as B, D, A, C and Option (3) as B, A, D, C. For the benefit of students and to ensure a single answer, Option (3) has been changed to D, B, A, C.
NCERT (2026-27 edition):
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