Tag: book keeping and accountancy

Questions Related to book keeping and accountancy

Debentures can be issued.

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. For consideration other wise than cash

  2. As collateral security for borrowings from financial institutions

  3. In lieu of dividends

  4. Both (a) and (b)

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Correct Option: D

A debenture holder gets.

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. Dividend

  2. Right prescribed articles

  3. Ownership of the company

  4. Interest at fixed rate

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Correct Option: D

The underwriting commission in the case of issue of debentures cannot exceed.

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. $2\%$

  2. $2.5\%$

  3. $3\%$

  4. $5\%$

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Correct Option: B

Maximum underwriting commission payable on issue of Debentures as per Companies Act is ______________.

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. $5\%$

  2. $2^{1 _{/2}}\%$

  3. $2\%$

  4. $4\%$

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Correct Option: B

Which of the following is true with regard to $10\%$ Debentures issued at a discount of $20\%$?

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. The carrying amount of debentures is $80\%$ of face value

  2. Issue price and the carrying amount of debentures will necessarily be equal

  3. At the time of redemption, the debenture holder will be paid the issue price

  4. The carrying amount and the face value of debentures are equal

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Correct Option: D

Which of the following is not a characteristic of Bearer Debentures?

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. They are treated as loan

  2. Their transfer requires a deed of transfer

  3. They are transferable by mere delivery

  4. The interest on it is paid to the bearer or holder

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Correct Option: B

Income tax deducted from interest paid on debentures is shown as.

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. Expenses of the Co.

  2. Asset of the Co.

  3. Liability of the Co.

  4. Income of the Co.

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Correct Option: C

Which of the following statements is true?

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. A debenture holder is owner of the company

  2. A debenture holder can get his money back only on the liquidation of the company

  3. A debenture issued at a discount can be redeemed at a premium

  4. A debenture holder receives interest only in the event of profits

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Correct Option: C

When debentures are issued as collateral security, the final entry for recording the transaction in the books is?

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. Credit Debentures A/c and Debit Cash A/c

  2. Debit Debentures Suspense A/c and Credit Cash A/c

  3. Debit Debentures Suspense A/c and Credit Debentures A/c

  4. Debit Cash A/c and credit the Loan A/c for which security is given

  5. Debit Debentures A/c and credit the Loan A/c for which security is given

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Correct Option: C

Which of the following statements is false?

book keeping and accountancy company accounts - issue of debentures issue of debentures for consideration other than cash types of debentures issue of debentures at par, premium, discount, collateral security and for consideration other than cash

  1. At maturity, debenture holders get back their money

  2. Debentures can be forfeited for non-payment of call money

  3. In company's balance sheet, debentures are shown under the head Secured Loans

  4. Interest on debentures is charged against profits

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Correct Option: B