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      Question

      Which of the following best describes ‘amortisation of

      debenture issue expenses’?
      A Charge to capital reserve Correct Answer Incorrect Answer
      B Spread over life of debentures as finance cost or deduction from security premium as per policy Correct Answer Incorrect Answer
      C Immediately charged to P&L as loss only Correct Answer Incorrect Answer
      D Added to debenture liability Correct Answer Incorrect Answer
      E Treated as contingent liability Correct Answer Incorrect Answer

      Solution

      Issue expenses are amortised over life (usually to P&L) per accounting policy; can be deducted from premium when appropriate.

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