Practice Test

Q1) When face value of debentures is more than issue price then debentures are said to be issued at- Show Answer

Q2) Premium on issue of debentures must be credited to a separate account called: Show Answer

Q3) Which of the following type of security can be issued at discount as per Companies Act, 2013?
(1) Equity Shares
(2) Sweat Equity Shares
(3) Preference Shares
(4) Debentures
(5) Bonds
Select the correct answer from the options given below -
Show Answer

Q4) The discount on issue of debentures must be treated as - Show Answer

Q5) In case of oversubscription of debentures each applicant receives the debentures in some proportion, it is known as - Show Answer

Q6) Which of the following security can be forfeited for non-payment of allotment or call money?
(I) Equity Shares
(II) Equity Shares, Preference Shares
(III) Preference Shares, Equity Shares & Debentures
(IV) Debentures
Select the correct answer from the options given below -
Show Answer

Q7) Which of the following security cannot be forfeited for non-payment of allotment or call money? Show Answer

Q8) If a company receives excess application money and the application money equal to debentures issued transferred to 5% Debentures A/c and application money received on excess debentures - some money is adjusted and against allotment and remaining was refunded, then which of the following entry is correct? _____, Show Answer

Q9) Debenture holders are the ….. of the company. Show Answer

Q10) Debenture holders - Show Answer

Q11) Debentures may be issued at - Show Answer

Q12) Debenture interest is paid at a predetermined _____ while dividend on equity shares is paid at a _____. Show Answer

Q13) Interest on debentures is the _____ against profits. Show Answer

Q14) In the company's balance sheet, debentures are shown under the head - Show Answer

Q15) Debentures ….. converted into shares as per the terms of issue of debenture. Show Answer

Q16) Debentures ….. forfeited for non¬ payment of call moneys. Show Answer

Q17) At the time of liquidation, debenture holders are paid-off ….. the shareholders are paid. Show Answer

Q18) If the debentures are issued at a price higher than the nominal value of the debentures, the premium should be credited to - Show Answer

Q19) Discount on issue of debentures is - Show Answer

Q20) Debentures may be issued by a company for - Show Answer

Q21) Debentures may be issued by a company for - Show Answer

Q22) The company may allot debentures to the vendors for acquiring some assets as payment for purchase consideration, such issue of debentures to vendors is known as issue of debentures for - Show Answer

Q23) If the value of debentures allotted to vendors for acquiring some assets as payment for purchase consideration is more than the agreed purchase price, the difference is credited to: Show Answer

Q24) If the value of debentures allotted to vendors for acquiring some assets as payment for purchase consideration is less than the agreed purchase price, the difference is debited to - Show Answer

Q25) When debentures are issued as collateral security which of the following accounting treatment can be adopted? Show Answer

Q26) Which of the following statements is TRUE? Show Answer

Q27) Premium on redemption of debentures account appearing in the balance sheet is Show Answer

Q28) At maturity, debenture holders get back their money as per the terms and conditions of redemption. Show Answer

Q29) Which of the following statements is false? Show Answer

Q30) Debenture interest - Show Answer

Q31) Which of the following is NOT a characteristic of Bearer Debentures? Show Answer

Q32) When debentures are issued as collateral security, the final entry for recording the collateral debentures in the books is: Show Answer

Q33) Debentures can be
I. Mortgage Debentures or Simple Debentures.
II. Registered Debentures or Bearer Debentures.
III. Redeemable Debentures or Irre¬deemable Debentures.
IV. Convertible Debentures or Non-convertible Debentures
Select the correct answer from the options given below.
Show Answer

Q34) Which of the following statements is false? Show Answer

Q35) Interest on debentures is calculated on: Show Answer

Q36) Which of the following is true with regard to 10% Debentures issued at a discount of 20%? Show Answer

Q37) Discount on issue of debentures is a: Show Answer

Q38) When debentures are issued as collateral security against any loan then holder of such debentures is entitled to: Show Answer

Q39) When debentures are redeemable at different dates, the total amount of discount on issue of debentures should be written off: Show Answer

Q40) Non convertible debentures refer to - Show Answer

Q41) "Interest accrued & due on debentures” is shown - Show Answer

Q42) "Interest accrued & not due on debentures” is shown - Show Answer

Q43) Tax deducted at source on interest on debenture is shown as - Show Answer

Q44) Debenture premium cannot be used - Show Answer

Q45) Debentures can be redeemed out of - Show Answer

Q46) Debentures normally cannot be redeemed at - Show Answer

Q47) If debentures are issued at discount and redeemed at premium - Show Answer

Q48) Profit on cancellation of debentures is transferred to - Show Answer

Q49) As a sound accounting policy when debentures are redeemed amount equal to - Show Answer

Q50) Statement I:
Debentures can be converted into shares as per the terms of issue of debentures.
Statement II:
Shares cannot be converted into debentures in any circumstances.
Select the correct answer from the options given below -
Show Answer

Q51) Arrange the priority of payment in case of liquidation of company:
I. Preference shares holders
II. Secured creditors
m. Equity shareholders
IV. Unsecured creditors
V. Debenture holders
Select the correct answer from the options given below -
Show Answer

Q52) Discount on issue of debentures, being a capital loss must be shown - Show Answer

Q53) Sound business policy demands that discount on issue of debenture should be written off - Show Answer

Q54) Which of the following is not a method of writing off discount on issue of debentures? Show Answer

Q55) If the company acquires some assets from the vendor and instead of paying the vendor in cash, the company may allots debentures in payment of purchase consideration. In such case if the face value of debentures issued is more than value of assets acquired then difference will be - Show Answer

Q56) If the company acquires some assets from the vendor and instead of paying the vendor in cash, the company may allots debentures in payment of purchase consideration. In such case if the face value of debentures issued is less than value of assets acquired then difference will be - Show Answer

Q57) Debentures Suspense Account - Show Answer

Q58) Who of the following is not required to create Debenture Redemption Reserve? Show Answer

Q59) Every company required to create DRR shall on or before the 30th day of April in each year, invest or deposit, as the case may be, a sum which shall not be less than _____, of the amount of its debentures maturing during the year ending on the 31st day of March of the next year Show Answer

Q60) An other name of Debenture Redemption Fund Method is - Show Answer

Q61) An other name of Debenture Redemption Fund Method is - Show Answer

Q62) .An other name of Debenture Redemption Fund Method is - Show Answer

Q63) Debenture redemption fund investment account will appear on the assets side of the balance sheet under the head _____, while debenture redemption fund account will appear on the liabilities side under the head _____ Show Answer

Q64) Which of the following is correct journal entry for annual contribution to sinking fund created for redemption of debentures? Show Answer

Q65) Loss on sale of Debenture Redemption Fund Investment account must be set-off
against -
Show Answer

Q66) If the purchase price for the debentures includes interest for the expired period, the quotation is said to be - Show Answer

Q67) If nothing is stated, purchase & sale of debentures, government securities should be taken to be on - Show Answer

Q68) If debentures are issued at discount but redeemable at premium then - Show Answer

Q69) Debenture issued at par but redeemable at price less than face value then - Show Answer

Q70) Correct entry to transfer interest received on sinking fund investment is - Show Answer

Q71) ZPA Ltd. issued 10,000,12% Debentures of Rs. 100 each at per payable in full on application by 1st April, 2019. Applications were received for 11,000 Debenture. Debentures were allotted on 7th April, 2019. Excess money was refunded. Amount that will appear in balance sheet as “12% Debenture” = ? Show Answer

Q72) Z Ltd. issued 10,000, 12% Debentures of Rs. 100 each at a discount of 10% payable in full on application by 31st May, 2019. Applications were received for 12,000 debentures. Debentures were allotted on 9th June 2019. Excess monies were refunded on the same date. Amount
that will appear in balance sheet as “12% Debenture” = ?
Show Answer

Q73) ZPA Ltd. issued 10,000,12% Debentures of Rs. 100 each at Rs. 94 on 1st January, 2010. Under the terms of issue, the debentures are redeemable at the end of 8 years from the date of the issue. Calculate the amount of discount to be written-off in each of the 8 years. Show Answer

Q74) HDC Ltd. issued 10,000,12% Debentures of Rs. 100 each at Rs. 94 on 1st January 2010. Under the term of issue, l/5th of the debentures are annually redeemable by drawings, the first redemption occurring on 31 st December 2010. Calculate the amount of discount to be written offin2010&2011. Show Answer

Q75) Z Ltd. issued 10% Debentures of Rs. 10 to a vendor having face value Rs. 2,50,000 for purchase of fixed assets of Rs. 2,00,000. No. of debentures to issued to vendors = ? Show Answer

Q76) X Ltd. obtained loan from IDB1 of Rs. 10,00,000, giving as collateral security of Rs. 15,00,000, 14% Debenture on 1st April 2019. Which of the following accounting treatment is correct to issue debenture as collateral security? Show Answer

Q77) Z Ltd. issued Rs. 1,00,000 debenture at a discount of 6% on 1.1.2019 repayable in 5 equal installment. Discount to be written off in each 5 calendar year - Show Answer

Q78) Moon Ltd. issued 5,000 debentures of Rs. 100 each at a discount of 10%. The expenses on issue amounted to Rs. 20,000. The company wants to redeem the debentures at the rate of Rs. 1,00,000 each year commencing with the end of 5th year. How much discount and expenses should be written off in each year? Show Answer

Q79) Ganga Ltd. purchased fixed asset of Rs. 2,00,000. The consideration was paid by issue of 12% Debenture of Rs. 100 each at discount of 20%. The debenture A/c to be credited with - Show Answer

Q80) N Ltd. purchased fixed asset of Rs. 4,00,000 out of Rs. 1,30,000 paid in cash and balance in debentures. The consideration was paid by issue of 12% Debenture of Rs. 100 each at 10% discount.
No. of debentures to be issued = ?
Show Answer

Q81) F Ltd. purchased Machinery from G Company for a book value of Rs. 4,00,000. The consideration was paid by issue of 10% debentures of Rs. 100 each at a premium of 25%. The debenture account was credited with _____. Show Answer

Q82) T Ltd. has issued 14% Debentures of Rs. 20,00,000 at a discount of 10% on April 1, 2017 and the company pays interest half-yearly on June 30, and December 31 every year. On March 31,2019, the amount shown as "interest accrued but not due’’ in the Balance Sheet will be - Show Answer

Q83) On May 1, 2018, UWB Ltd. issued 7% 10,000 convertible debentures of Rs. 100 each at a premium of 20%. Interest is payable on September 30 and March 31 every year. Assuming that the interest runs from the date of issue, the total amount of interest expenditure debited to profit and loss account for the year ended March 31, 2019 will be: Show Answer

Q84) W Ltd. issued 20,000,8% debentures of Rs. 10 each at par, which are redeemable after 5 years at a premium of 20%. The amount of loss on redemption of debentures to be written off every year will be: Show Answer

Q85) P Ltd. issued 5,000,12% 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 = ? Show Answer

Q86) Rama Ltd. issued 40,000,8% debentures of Rs. 10 each which are redeemable after 5 years at a premium of 20%. The amount of loss on redemption of Debentures to be written of every year will be - Show Answer

Q87) On 1st July, 2017 a company issued 2,500, 9% debentures of Rs. 100 each at a discount of 10%. The debentures were redeemable by five annual drawings of Rs. 50,000 on 31 st March each year. Calculate the amount of discount on debentures to be written off at the end of each year on 31st March. Show Answer

Q88) Following journal entry appears in the books of KAKA Ltd.:
Bank A/c Dr. 9,600
Loss on issue of Dr. 1,000
Debentures A/c
To 9% Debentures A/c 10,000
To Premium on Redemption 600
of Debentures A/c
Debentures must have been issued for -
Show Answer

Q89) P Ltd. issues 8% Debenture of Rs. 100 at a discount of 5%, redeemable at the end of 5 years at par. Which of the following entry is correct? Show Answer

Q90) Q Ltd. issues 11% Debenture of Rs. 100 at par, redeemable at the end of 5 years at a premium of 5%. Which of the following entry is correct? Show Answer

Q91) Sana Ltd. issues 13% Debenture of Rs. 100 at a premium of 5%, redeemable at the end of 5 years at a premium of 10%. Which of the following entry is correct? Show Answer

Q92) Eagle Ltd. issued 15% Debenture of Rs. 100 each at a discount of 5%, but redeemable at a premium of 5% at the end of 4 years then - Show Answer

Q93) Fortune Ltd. issued 12% debentures of Rs. 100 each at a premium of 5% redeemable at 110% then - Show Answer

Q94) Jaju Ltd. issued Rs. 70,000,12%debentures of Rs. 100 each at a premium of 5% redeemable at 110%. If balance sheet is prepared only for this transaction then balance sheet will tally at - Show Answer

Q95) R Ltd. issues 12% Debenture of Rs. 100 at a discount of 5%, redeemable at the end of 5 years at a premium of 10%. Which of the following entry is correct? Show Answer

Q96) S Ltd. issued 10,000, 12% debentures of Rs. 100 each at a discount of 5%. These debentures are redeemable at a premium of 10% after 5 years Balance at the end of third year of "Loss on Issue of Debenture A/c” will be - Show Answer

Q97) X Ltd. obtained loan from IDBI of Rs. 10,00,000, giving as collateral security of Rs. 15,00,000, 14% Debenture on 1st April 2019. Which of the following entry is correct? Show Answer

Q98) Z Ltd. issued 10% Debentures to public for cash at 95% having face value Rs. 10,00,000 then- Show Answer

Q99) Q Ltd. issued 10% Debentures to a vendor having face value Rs. 2,50,000 for purchase of fixed assets of Rs. 2,00,000 then - Show Answer

Q100) X Ltd. borrowed Rs. 25,00,000 from a scheduled bank at an annual interest rate of 12% and deposited 14% debentures of the face value of Rs. 40,00,000 as collateral security. If balance sheet is prepared only for this transaction then balance sheet will tally at - Show Answer

Q101) Mars Ltd. obtained loan of Rs. 5,00,000 on 31 st March, 2016 from a bank by issuing and securing 6,000,12% debentures of Rs. 100 each as collateral security. If balance sheet is prepared only for this transaction then balance sheet will tally at - Show Answer

Q102) On 1.1.2015 X Ltd. issued 10,000 fifteen years 10% debentures of Rs. 100 each.
On 1.4.2020 the company gave notice to the debenture holders of its intention to redeem the debentures on 1.10.2020 either by payment in cash or by allotment of 11 % preference shares of Rs. 100 each at Rs. 130 per share or 11% second debenture of Rs. 100 at Rs. 96 per debenture. Holders of 4,000 debentures accepted the offer of the preference shares. How much preference shares will be issued if debentures are redeemed at 4% premium?
Show Answer

Q103) On 1.1.2015 X Ltd. issued 10,000 fifteen years 10% debentures of Rs. 100 each. On 1.4.2020 the company gave notice to the debenture holders of its intention to redeem the debentures on 1.10.2020 either by payment in cash or by allotment of 11 % preference shares ofRs.l00eachatRs.l30per share or 11% second debenture of Rs. 100 at Rs. 96 per debenture. Holders of 4,800 debentures accepted the offer of the 11 % second debentures. How much 11% second debentures will be issued if debentures are redeemed at 9% premium? Show Answer

Q104) On 1st April, 2018, Rosy Ltd. issued 20,000,13% debentures of Rs. 100 eachat 5% discount. Debenture holders have an option to convert their holdings in 14% preference shares of Rs. 100 each at a premium of Rs. 25 per share. On 31st March, 2019, one year’s interest has accrued on these debentures and has remained unpaid. All debenture holders notified their intention to convert holdings in 14% preference shares.
No. of 14% preference shares to be issued = ?
Show Answer

Q105) ABC Ltd. issued 11 % debenture at Rs. 95, redeemable at the end of 10 year at 98%. Which of the following entry is correct? Show Answer

Q106) On 10.4.2019, Zenith Ltd. issued 12,500, 12% debentures of Rs. 100 each at Rs. 98. Holders of these debentures have an option to convert their holdings into 14% preference shares of Rs. 100 each at a premium of Rs. 25 per share at any time within 3 years. On 31.3.2020, holders of 2,500 debentures notified their intention to exercise the option.
No. of 14% preference shares to be issued = ?
Show Answer

Q107) On 1.1.2019, Sanjay Ltd. had outstanding in its books 1,000, 12% Debentures of Rs. 100 each. The interest is payable on 30th June & 31st December. On 1.3.2019 the directors acquired in the open market Debentures of Rs. 10,000 @ Rs. 98.00 (cum-interest) for immediate cancellation. For this transaction Debenture Redemption A/c will be debited by - Show Answer

Q108) On 1.1.2019, Mumtaz Ltd. had outstanding in its books 1,000, 12% Debentures of Rs. 100 each. The interest is payable on 30th June & 31st December. On 1st Nov, 2019 the directors acquired in the open market Debentures of Rs. 5,000 @ Rs. 98.50 (ex-interest) for immediate cancellation. Cash outflow for given transaction is - Show Answer

Q109) A company purchased 200, 12% debentures of Rs. 100 each at Rs. 97 on cum interest basis on 1st July, 2019 for immediate cancellation. Interest is payable on 30th September and 31st March each year. Profit on cancellation of debentures is - Show Answer

Q110) ABC Ltd. had Rs. 10,00,000, 6% Debentures of Rs. 100 each as on 31st March, 2018. Company purchased in the open market following debentures for immediate cancellation:
On 1.7.2019: 1,000 Debentures @ Rs. 97 cum-interest
On 28.2.2019: 1,800 Debentures @ Rs. 99 ex-interest.
Debenture interest due dates are 30th September and 31st March.
Profit on cancellation of debentures is -
Show Answer

Q111) On 1st April, 2016 Kapil Ltd. had made an issue of 2,000, 6% debentures of Rs. 100 each. The Company during the year 2017-2018 purchased for cancellation 500 of these debentures. Company paid Rs. 95 per debenture for 400 debentures and Rs. 98 per debenture for the rest. The expenses on purchase amounted to Rs. 200. Amount to be transferred to Capital Reserve will be - Show Answer

Q112) Z Ltd. had issued 1,000,6% Debentures of Rs. 100 each. Company on 1.3.2018 purchased 50 of its debentures at Rs. 96 each cum-interest. Interest payable on 30th June and 31st December. Investment in Own Debenture A/c will be debited by - Show Answer

Q113) Sinking fund investment appeared in the books of P Ltd. on 1.1.2018 at Rs. 3,00,000 which was represented by 10% Rs. 3,60,000 secured bonds of Government of India. Company sold the investments at 80%. Profit or loss on sale of investment is - Show Answer

Q114) Following balances appeared in the books of R Ltd. on 1.4.2019:
(a) Debenture Redemption Fund Rs. 90,000 represented by investments of an equal amount (nominal value Rs. 1,12,500).
(b) 12% debentures stood at Rs. 1,35,000. Company sold investments of Rs. 48,000 at Rs. 54,000. Debentures of Rs. 45,000 were redeemed at a premium of 20%.
Closing balance of Debenture Redemption Fund A/c after giving effect to above transactions will be -
Show Answer

Q115) On 31.12.2018, B Ltd. showed in their accounts debenture redemption fund of Rs. 1,50,000 which was represented by Rs. 1,51,000,5% municipal bonds purchased for Rs. 1,50,000. On 28.2.2019, the company had a balance of Rs. 28,000 at their bank and they paid into the bank account, the proceeds of sale of foregoing investments for Rs. 1,50,500. On 1st March, 2019, the debentures of the value of Rs. 1,50,000 were paid. How much amount will be transferred to General Reserve A/c out of Debenture Redemption Fund A/c after giving effect to above transactions? Show Answer

Q116) G Ltd. had issued 12%, Rs. 10,00,000 debentures @ Rs. 100 in the past. For the purpose of redemption, it maintains a debenture redemption fund with an annual contribution of Rs. 90,000. Balance of fund stood at Rs. 4,50,000 represented by 6%, Rs. 5,00,000 government loan. Rs. 2,00,000 government loan was sold @ Rs. 93.50 and the proceeds were utilized to purchase debentures for cancellation @ Rs. 85 each. Assume that Rs. 20,000 debentures have been redeemed out of capital and the balance with face value of Rs. 1,80,000 has been redeemed out of debenture redemption fund account. Closing balance of Debenture Redemption Fund A/c after giving effect to above transactions will be: Show Answer

Q117) Following balances appeared in the books of Bright Ltd.:
(a) Sinking fund account Rs. 50,000
(b) Sinking fund investment account Rs. 48,000 (10% Govt, securities, nom¬inal value Rs. 45,000)
(c) 12% Debenture account Rs. 1,00,000.
Company sold Rs. 30,000 Govt, securities at 110% and redeemed part of the debentures at a premium of 10%. Closing balance of Sinking Fund A/c will be -
Show Answer

Q118) Following balances appeared in the books of R Ltd.:
12% Debentures - Rs. 8,00,000
Sinking fund - Rs. 7,00,000
Sinking fund investment - Rs. 7,00,000 (Represented by 10% Rs. 7,50,000 secured bonds of Government of India)
Annual contribution to the sinking fund was Rs. 1,20,000 made on 31st March each year. On 31.3.2018, balance at bank was Rs. 3,50,000 before receipt of interest. Company sold the investments at 90% for redemption of debenture at a premium of 10% on above date. Amount to be transferred to general reserve after redemption of debentures will be -
Rs. 5,90,000 Show Answer

Q119) Following balances appeared in the books of JKJ Ltd.:
(a) Sinking fund account Rs. 62,500
(b) Sinking fund investment account Rs. 60,000 (10% Govt, securities, nomi¬nal value Rs. 56,250)
(c) 12% Debenture account Rs. 1,25,000.
Company sold Rs. 37,500 Govt, securities at 110% and redeemed part of the debentures at a premium of 10%. Closing balance of Sinking Fund A/c will be -
Show Answer

Q120) In case of issue of debentures, the rate of underwriting commission paid or agreed to be paid shall not exceed: Show Answer

Q121) Applications bearing the stamp of the respective underwriter are called as: Show Answer

Q122) During the year 2018-19, a company redeemed its 10% debenture of Rs 8,00 000 at 10% premium and after some time a fresh issue was made of new 10% debenture of Rs 7,50,000 at a premium of 25%. The net cash flow from debenture would be:
Show Answer

Q123) The entry ­
"Debentures Suspense A/c Dr
To Debentures A/c can be passed/ done : Show Answer

Q124) C Limited issued 8% Debentures of Rs 65,00,000 at 5% discount which are redeemable at a premium of 10%. On recording the transaction "Loss on Issue of Debentures Account" will be: Show Answer

Q125) M Ltd. issued 8% Debentures Rs 60 Lakh on 1 January, 2019 at a discount of 10%. The debentures are redeemable in three equal installments of Rs 20 Lakh each payable on 31st December every year. The
amount of discount to be written at the end of the year on 31st March, 2021,will be:
Show Answer

Q126) S Ltd. had issued 80,000, 8% Debentures of rs 100 each redeemable on 31st December, 2019 at a premium of 20%. The company offered three options to debenture holders, out of which one is to convert their holding into equity, shares of Rs 10 each at a premium of Rs 3.50 Per share. This offer was accepted by the holders of 49,275 debentures. For this, number of equity shares issued be:
Show Answer

Q127) G Ltd. has 8,00,000, 12% Debentures of Rs 100 each. During the year 2018-2019 the company purchased its own debentures from the open market for immediate cancellation are as follows:
(i) Aug. 1, 2018: 15000 Debentures @ Rs 95.50 (ex-interest)
(ii) Jan. 1, 2019: 25000 Debentures @ Rs 101.50 (cum-interest)
If debenture interest is payable on 30th September and 31st March every year, then the amount of profit or loss on cancellation of debentures will be: Show Answer

Q128) The profit on cancellation of debentures should be
transferred to: Show Answer

Q129) Which of the following is not a method of redemption of debentures? Show Answer

Q130) Every company required to create/maintain Debenture Redemption Reserve shall before the 30th day of April of each year, deposit or invest ( as the case may be ) at least _________ % of the amount of its debentures maturing during the year ending on the 31st day of March next year in the prescribed mode. Show Answer

Q131) Neel Ltd. purchased a building worth Rs 99,00,000 and issued 12% Debentures of Rs 100 each at a premium of 10%. What will be the amount of premium? Show Answer

Q132) Saket Ltd. purchased a machinery worth Rs 1,20,000 and building worth Rs 2,00,000 from Rashmi Ltd. for an agreed purchase consideration of Rs 3,00,000 to be satisfied by the issue of 3,000, 10% debentures of Rs 100 each. Calculate the amount to be transferred to capital reserve A/c: Show Answer

Q133) Five years ago X Ltd. had issued 12% Debentures of 30 lakh (redeemable in six equal annual Installments). These Debentures will be shown in the Balance Sheet of a company under the heading: Show Answer

Q134) "Interest accrued & due on debentures" is shown _____ Show Answer

Q135) Discount on issue of debentures is a: Show Answer

Q136) Tax deducted at source on interest on debenture is shown
as _____ Show Answer

Q137) T Ltd. purchased machinery from N Company for a book value of Rs 4,00,000. The consideration was paid by issue of 10% debentures of Rs 100 each at a premium of 25%. The debenture account was credited with Show Answer

Q138) K Ltd. issued 5,000, 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
is
Show Answer

Q139) Amount due on calls made but not paid is known as _____ Show Answer

Q140) XYZ Ltd. issued 60,000, 12% debentures of Rs 100 each. 70% of the issue was underwritten by ABC Ltd. Applications for 56,000 debentures were received by the XYZ Ltd. The liability of ABC Ltd is: Show Answer

Q141) P Ltd. issued 12% 10,000 debentures of Rs 100 each at a discount of 10% on 1st April 2016. The company pays interest half yearly on 30th June and 31st December every year. On 31st March 2020 the amount shown as 'Interest accrued but not due' in the balance sheet will be: Show Answer

Q142) Debenture can be issued:
(i) For cash
(ii) For Consideration other than Cash
(iii) As Collateral Security
Show Answer

Q143) P Ltd. issues 10,000 7% debentures of Rs 100 each at a discount of 5% redeemable at the end of 7 years at a premium of 6%. Loss on issue of debenture account will be debited by: Show Answer

Q144) As per guidelines issued by SEBI, what percentage of the amount of debentures must be transferred to "Debenture Redemption Reserve" before the commencement of redemption of debenture, in case of convertible debentures:
Show Answer

Q145) When debenture is issued as collateral security, the final entry for recovered the collateral debenture in books is: Show Answer

Q146) Wind Ltd. issued 30,000 12% debentures of Rs 10 each at par which are redeemable after 5 years at a premium of 10%. The amount of loss on redemption to be written off every year will be: Show Answer

Q147) If the purchase price for the debentures includes interest for the expired period, the quotation is said to be ______ Show Answer

Q148) If the sinking fund is non-cumulative, the interest received on Sinking Fund Investment is not invested and not credited to Sinking Fund A/c. The amount of interest is: Show Answer

Q149) Which of the following is false:


Show Answer

Q150) Which of the following is true with regard to, 12% debentures issued at a discount at 10%? Show Answer

Q151) Rule 12 of the Companies (Share Capital and Debentures) Rule, 2014 is related to______ Show Answer

Q152) When debentures are issued as collateral security, the account to be debited to record in the books of account is. ____ Show Answer

Q153) When there is profit on cancellation of debentures, the amount of profit is transferred to_____ Show Answer

Q154) A company cannot issue a prospectus or make an offer or invitation to..................... for subscribing to debentures unless the company has before issuing such a prospectus, appointed one or more debenture trustees. Show Answer

Q155) X Ltd. purchased a building worth Rs 4,50,000 and furniture worth Rs 2,50,000 from Z Ltd. for an agreed purchase consideration of Rs 6,60,000 to be satisfied by issue of 8% debentures of Rs 100 each at a premium of 10%. What is the amount to be transferred to capital reserve account? Show Answer

Q156) ABC Ltd. issued 10%, 10,000 debentures of Rs 100 each at a discount of 8% and which are redeemable at a premium of 5%. What is the amount of loss on issue of debentures? Show Answer

Q157) Unless written off, the loss on issue of debentures is shown: Show Answer

Q158) If debentures are issued as consideration for purchase of any fixed asset, the entry is: Show Answer

Q159) When debentures are issued as collateral security, the final entry for recording the transaction in the books is: Show Answer

Q160) Interest payable on debentures is: Show Answer

Q161) A company issues 14%, debentures of 10,00,000 at a discount of 10%.
The discount allowed will be treated in the account books as: Show Answer

Q162) Which of the following statements is false? Show Answer

Q163) Discount on issue of debentures is a: Show Answer

Q164) When debentures are issued at par and are redeemable at premium, the credit given to Premium of Redemption of Debenture Account is in the nature of: Show Answer

Q165) Loss on issue of debentures is treated as: Show Answer

Q166) Which of the following is false? Show Answer

Q167) The following journal entry appears in the books of X Co. Ltd: Bank A/c Dr Rs 4,75,000
Loss on Issue of Debenture A/c Dr Rs 25,000
To 12% Debentures A/c Rs 5,00,000
Debentures have been issued at a discount of:
Show Answer

Q168) 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 vendors of asset are: Show Answer

Q169) How many debentures will a company be required to issue for satisfying the purchase consideration of 28,80,000, if debentures of Rs 100 are issued at a premium of 20 per debenture? Show Answer

Q170) F Ltd. purchased machinery from G company for a book value of Rs 4,00,000. The consideration was paid by issue of 10% debentures of Rs 100 each at a discount of 20%. The debenture account will be credited by: Show Answer

Q171) T Ltd. has issued 15% Debentures of Rs 20,00,000 at a discount of 10% on April 01, 2004 and the company pays interest half-yearly on June 30 and December 31 every year. On March 31, 2006, the amount shown as "interest accrued but not due" in the Balance Sheet will be: Show Answer

Q172) When debentures of 1,00,000 are issued as Collateral Security against
a loan of 1,50,000, the entry for issue of debentures will be: Show Answer

Q173) P Ltd. issued 10,000, 12% debentures of 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 Show Answer

Q174) On May 01, 2003, Y Ltd. issued 7%, 40,000 convertible debentures of * 100 each at a premium of 20%. Interest is payable on September 30 and March 31, every year. Assuming that the interest runs from the date of issue, the amount of interest expenditure debited to profit and loss account for the year ended March 31, 2004 is: Show Answer

Q175) W Ltd. issued 20,000, 8% debentures of 10 each at par which are redeemable after 5 years at a premium of 20%. The amount of loss on redemption of debentures to be written off every year is:
Show Answer

Q176) Which of the following statements is false? Show Answer

Q177) Which of the following is not a characteristic of Bearer Debentures? Show Answer

Q178) The debentures which are secured by a charge upon some or all assets of the company are known as: Show Answer

Q179) When debentures are to be redeemed at premium an extra entry has to be made at the time of issue of debentures, which a/c should be credited in this entry?
Show Answer

Q180) When debentures are issued at a discount, it is prudent to write off the discount: Show Answer

Q181) Ansh Ltd. issued 5,000 share of Rs 10 each for subscription. 4,000 Debentures were subscribed by the public by paying Rs 3 as application money. Number of debentures allotted to public by Ansh Ltd. will be: Show Answer

Q182) Interest received on debenture redemption fund investment is: Show Answer

Q183) Puru Ltd. issued 10,000 12% Debentures of Rs 100 each at a discount of 10% payable in full on application by 31st March, 2007. Application were received for 12,000 debentures. Debentures were allotted on 9th June, 2007. The amount of excess money refunded on the same date will be: Show Answer

Q184) "Non-convertible" debentures is inferred as: Show Answer

Q185) Tahil Ltd. has issued 14% Debentures of Rs 20,00,000 at a discount of 10% on April 01, 2005 and the company pays interest half-yearly on June 30, and December 31 every year. On March 31, 2007, the amount shown as "interest accrued but not due" in the balance sheet will be: Show Answer

Q186) XYZ Ltd. purchased a machinery for Rs 10,00,000 from Mohan Ltd. and the consideration was paid by the issue of 18% debentures of Rs 100 each at a discount of 20%. Calculate the number of debentures to be issued: Show Answer

Q187) Debenture holders are called the ______ of a company. Show Answer

Q188) ABC Ltd. purchased a machinery from Microtee Ltd. for Rs 50,00,000 and the consideration was paid by issuing debentures of Rs 100 each at a discount of 20%. Calculate the amount to be credited to the debenture account: Show Answer

Q189) ABCD Ltd. issued 1,000, 9% debentures of Rs 100 each at a discount of 10%, which will be redeemed after 5 years at a premium of 10%. Calculate the amount of loss on issue of debentures Show Answer

Q190) When the debentures are issued as a collateral security then what entry
will be passed? Show Answer

Q191) Which of the following statement is NOT true? Show Answer

Q192) Interest on debentures issued as a collateral security is paid on: Show Answer

Q193) A debenture holder is entitled to: Show Answer

Q194) If the debentures allotted for consideration other than cash are more than the agreed purchase price, the difference shall be debited to: Show Answer

Q195) If the debentures allotted for consideration other than cash are less than the agreed purchase price, the difference is credit to: Show Answer

Q196) Which of the following will be the journal entry for recording the issue of shares at par against purchase of Machinery? Show Answer

Q197) Debentures of a company can be issued Show Answer

Q198) On issue of debentures as a collateral security, which account is credited? Show Answer

Q199) G Ltd. purchased land and building from H Ltd. at a book value of Rs 2,00,000. The consideration was paid by issue of 12% debentures of Rs 100 each at a discount of 20%. For this transaction, the debentures account would be credited with
Show Answer

Q200) The holder of debentures issued as collateral security to a loan is entitled to interest on: Show Answer

Q201) K Ltd, Issued Rs 15,000, 12% Debentures of Rs 50/- each at premium of 10% payable as Rs 20/- on application and balance on allotment Debentures are redeemable at per after 6 years. All the money due on allotment was called up and revised. The amount of premium will be:
Show Answer

Q202) Debenture is issued as a collateral security to a loan, interest will be given on- Show Answer

Q203) Which of the following statement is true? Show Answer

Q204) Match list I with list II and select the correct answer using the codes given below the list:
List I
X. Discount on Debenture
y. Forfeited Capital
z. Income tax payable
w. Debtors acceptance The correct option is:
List II
1. Currency liability
2. Non-current Assets
3.Current Assets
4.Non current Liability Show Answer

Q205) On redemption of Debentures, the amount lying in Debenture Redemption Reserve, which is no longer necessary to be retained, should be transferred to Show Answer

Q206) Debenture Redemption Premium A/c is: Show Answer

Q207) If debentures of Rs 1,000 are purchased for Rs 980 by the company, the difference of Rs 20 will be assumed to be: Show Answer

Q208) Rs 4,25,000 debentures are issued against the purchase of assets of Rs 4,50,000 in this case Rs 25,000 will be supposed to be:
Show Answer

Q209) The interest on Debenture Redemption Fund Investments is credited to: Show Answer

Q210) The balance of debenture sinking fund is finally transferred to: Show Answer

Q211) Debentures which are transferable by mere delivery are: Show Answer

Q212) Discount on issue of debentures is: Show Answer

Q213) Debenture is the part of: Show Answer

Q214) The interest on Debentures is Show Answer

Q215) The consideration of Debentures is Show Answer

Q216) A Co. issued 1,00,000, 12% Debentures of Rs 100 each. The interest on Debentures is Show Answer

Q217) According to SEBI guidelines by what percentage of amount of debentures the debenture redemption fund will be raised before redemption? Show Answer

Q218) The Premium on redemption of debentures is Show Answer

Q219) Sinking investment always shows Show Answer

Q220) Debentures represent: Show Answer

Q221) Loss on issue of debenture A/c is: Show Answer

Q222) The discount on debentures which is not written off is shown in final account of company: Show Answer

Q223) The journal entry for debentures issued at par and are also redeemable at par: Show Answer

Q224) If debentures of 3,00,000 are issued at par but redeemable at 5% premium due will be debited to:
Show Answer

Q225) If vendor's debentures of Rs 8,00,000 is issued to vendor in purchase consideration of net assets of Rs 8,00,000, then Rs 2,00,000 will be credited to:
Show Answer

Q226) Debenture which transfer by mere delivery are: Show Answer

Q227) In the Companies Act 2013 description of Debentures is given in the: Show Answer

Q228) When debentures are redeemed by sinking fund method, after redemption of debentures, the balance of debenture redemption fund a/c should be transferred to: Show Answer

Q229) Following is not a characteristic of debentures: Show Answer

Q230) Discount on issue of debentures is a: Show Answer