Issue and Redemption of Debentures

Debentures represent the

• Long-term Borrowings of a Company

• The Investment of Equity- Shareholders

• Directors share in a Company

• Short - Term Borrowings of a Company

Debenture holders are

• Owners of the Company

• Promoters of the Company

• Debtors of the Company

• Creditors of the Company

Zero Coupon Bonds are Issued

• At Zero interest rate

• With Specified Rate of Interest

• Without Specified Rate of Interest

• None

Interest Payable on Debenture is

• an Appropriation of profits of the Company

• a charge against profits of the Company

• transferred to sinking fund investment account

• transferred to general reserve

A Debenture Holder is entitled to

• Fixed Dividend

• Share in Profit

• Voting rights in the Company

• Interest at the Fixed Rate

On liquidation of a company, Principal amount of debentures is returned

• First of All

• Last of All

• Before Equity Capital

• After Equity Capital

Which of the Following is False

• Debenture is a form of public borrowings

• It is customary to prefix debentures with the agreed rate of interest

• Debenture interest is a charge against profits

• the issue price and redemption value of debentures cannot differ

Which of the following is not a characteristics of Bearer Debentures

• They are treated as negotiable instruments

• their transfer requires a deed of transfer

• they are transferable by mere delivery

• The interest on it is paid to the holder irrespective of identity

Which of the following statement is false?

• At maturity, debenture holders get back their money

• Debentures can be forfeited for non-payment of call money

• In Company's Balance Sheet, debentures are shown under the head Long term borrowings

• Interest on Debentures is a charge against profit

The principal amount of debentures will be repaid by the Company either at the end of a specified period or by installments during the life time of the Company. Such types of debentures are Called

• Redeemable Debentures

• Irredeemable Debentures

• Convertible Debentures

• Bearer Debentures