Tag: issue of debentures at par, premium, discount, collateral security and for consideration other than cash

Questions Related to issue of debentures at par, premium, discount, collateral security and for consideration other than cash

ABC Ltd. has issued $3,000$ fully Convertible Debentures of Rs. $100$ each. Each Debentures is convertible into $8$ shares of Rs. $10$ each. Amount of share capital credited on conversion will be.

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. Rs. $2,40,000$

  2. Rs. $60,000$

  3. Rs. $3,00,000$

  4. Rs. $80,000$

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Correct Option: A

The following entry appears in the books of Vikas Ltd.

Rs. Rs.
Bank Account $95,000$
Loss on issue of Debenture A/c $13,000$
To $8\%$ Debentures A/c $1,00,000$
To Premium on Redemption of Debentures A/c $8,000$

Debentures have been issued at a discount of.

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. $10\%$

  2. $7\%$

  3. $6\%$

  4. $5\%$

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Correct Option: D

When debentures are issued as collateral security to a banker, which account will be debited.

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. Bank A/c

  2. Debenture Suspense Account

  3. Debenture Redemption A/c

  4. Debenture holders A/c

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Correct Option: B

X Co. Ltd purchased assets worth Rs. $28,80,000$. It issued debentures of Rs. $100$ each at a discount of $4\%$ in full satisfaction of the purchase consideration. The number of debentures issued to the various of asset 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. $30,000$

  2. $28,800$

  3. $32,000$

  4. $35,000$

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Correct Option: A

The following journal entry appears in the books of X Co. Ltd.

Bank A/c Dr. Rs. $4,75,000$
Loss on Issue of Deb. A/c Dr. Rs. $75,000$
To $12\%$ Debentures A/c $5,00,000$
To Premium on redemption of Deb. A/c $50,000$

Debentures have been issued at a discount of.

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. $15\%$

  2. $5\%$

  3. $10\%$

  4. $20\%$

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Correct Option: B

When debentures of Rs. $1,00,000$ are issued as collateral security, against a loan of Rs. $1,50,000$, the entry for issue of debentures will be

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 Rs. $1,50,000$ and debit cash A/c. Rs. $1,50,000$

  2. Debit Debenture Suspense A/c Rs. $1,00,000$ and credit Cash A/c Rs. $1,00,000$

  3. Debit Debenture Suspense A/c Rs. $1,00,000$ and Credit Debentures A/c Rs. $1,00,000$

  4. Debit Cash A/c Rs. $1,50,000$ and credit Bank A/c Rs. $1,50,000$

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Correct Option: C

It is uncommon is case of debentures issued as collateral security that______.

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. Interest be given on debentures

  2. Accounting entry is not made

  3. Existence of debenture given as a note in balance sheet

  4. None of the above

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Correct Option: D

Features of debentures issued as collateral securities. Select from the given options______.

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. Only interest on loan to be paid

  2. Interest on loan as well debenture to be paid

  3. Debenture issued as a security towards the loan taken

  4. Both a & b

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Correct Option: D

P Ltd. issued $10,000$, $12\%$ debentures of Rs. $100$ each at a premium of $10\%$ which are redeemable after $10$ years at a premium of $20\%$. The amount of loss on redemption of debentures to be written off every year will be.

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. Rs. $1,60,000$

  2. Rs. $80,000$

  3. Rs. $20,000$

  4. Rs. $16,000$

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Correct Option: C

A Ltd issued $3,000$ $15\%$ Debentures of Rs. $100$ each at a discount of $7.5\%$ payable at a premium of $5\%$ at the end of $5$ years. The loss on issue of debentures will be.

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. Rs. $22,500$

  2. Rs. $30,000$

  3. Rs. $37,500$

  4. Rs. $45,000$

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Correct Option: C