Mention two differences between ‘Premium on Issue of Debentures’ and ‘Premium on Redemption of Debentures’.


Distinction between ‘Premium on Issue’ and ‘Premium on Redemption’ of Debentures:

 Premium on Redemption of DebenturesPremium on Redemption of Debentures
1.It is a capital profit.It is a capital loss.
2.It is shown on the Equity and liabilities side under the head “Reserve and Surplus”. It is Liability and appears under the head “Non-Current Liabilities” under sub-head “Other Long Term Liabilities” till the redemption of debenture.

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