Issue and Redemption of Debentures Test 1

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Issue and Redemption of Debentures Test 1

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Weekly Quiz Competition

Question 1
1 / -0

Debenture Premium Account is a -

A
Personal Account

B
Real Account

C
Nominal Account

D
None of these
Question 2
1 / -0

From the point of view of tenure, the debentures are classified as -

A
Secured and unsecured Debentures

B
Redeemable Debentures and Irredeemable Debentures

C
Convertible Debentures and Non-convertible Debentures

D
Registered Debentures and Bearer Debentures
Question 3
1 / -0

On $$1$$st April X Lts. issued Rs$$1,00,000 15\%$$ Debentures of Rs$$10$$ each at $$94\%$$ redeemable at per as follows:

Yearend Nominal value of Total Debentures to redeemed
2 10%
3 20%
4 30%
5 40%
The amount of discount to be written off each year assuming that the company closes its accounts on financial year basis is -

A
Rs$$2,400, Rs1,800, Rs 1,200, Rs 600$$

B
$$Rs 1,500, Rs 1,500, Rs 1,350, Rs 1,050, Rs 600$$

C
$$Rs1,200$$ each year

D
None of these
Question 4
1 / -0

On $$1$$st April X Lts. issued Rs$$1,00,000 15\%$$ Debentures of Rs$$10$$ each at $$94\%$$ redeemable at per as follows:

Year beginning Nominal value of Total Debentures to redeemed
2 10%
3 20%
4 30%
5 40%
The amount of discount to be written off each year assuming that the company closes its accounts on financial year basis is -

A
Rs$$1,500$$ each year

B
Rs$$1,200$$ each year

C
Rs$$2,000, Rs 1,800, Rs 1,400, Rs 800$$

D
None of these
Question 5
1 / -0

X.Ltd. issued Rs$$1,00,000$$ $$12\%$$ debentures of Rs$$100$$ each at a premium of $$10\%$$, which are redeemable after $$10$$ years at a premium of The amount of loss on redemption of debentures to be written off every year= ?

A
Rs$$10,000$$

B
Rs$$30,000$$

C
Rs$$20,000$$

D
Rs$$40,000$$
Question 6
1 / -0

X. Ltd. issued $$500, 15\%$$ Debentures of Rs$$100$$ each at a discount of $$10\%$$ redeemable at a premium of $$5\%$$ after $$4$$ years. The amount of annual interest on Debentures is -

A
Rs$$6,750$$

B
Rs$$7,500$$

C
Rs$$7,875$$

D
Rs$$7,125$$

Solution

Amount of annual interest= No. of debentures x face value of each debentures x Rate of interest p.a.
= 500 x 100 x 10/ 100
= Rs. 7500
Therefore, B is the correct option.
Question 7
1 / -0

X Ltd issues $$500, 15\%$$ Debentures of Rs$$100$$ each on $$1st$$ May at a discount of $$10\%$$ redeemable at a premium of $$5\%$$ after $$4$$ years. Interest was payable half yearly on $$30th$$ June and $$31st$$ December. The amount of interest accrued but not due to be shown in the balance sheet as at $$31st$$ March is-

A
Rs$$1,250$$

B
Rs$$1,875$$

C
Rs$$3,750$$

D
Rs$$5,000$$
Question 8
1 / -0

'Premium on Redemption of Debentures Account' is a:

A
Personal Account

B
Real Account

C
Nominal Account

D
None of the above

Solution

Premium on redemption of debentures is shown under liabilities side of the Balance Sheet, so, it is a personal account. This premium is payable by the company on redemption of the debentures to the debenture-holders.
Question 9
1 / -0

Withdrawal from DRR is permissible only after ____% of the debenture liability has been redeemed.

A
30

B
40

C
10

D
25
Question 10
1 / -0

A price exclusive of the interest for the period for which the seller held the debentures is called _________________.

A
Ex-interest price

B
Cum-interest price

C
Plus-interest price

D
Additional-interest price

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Re-Attempt Weekly Quiz Competition

Yearend	Nominal value of Total Debentures to redeemed
2	10%
3	20%
4	30%
5	40%

Year beginning	Nominal value of Total Debentures to redeemed
2	10%
3	20%
4	30%
5	40%

Issue and Redemption of Debentures Test 1

Result

Issue and Redemption of Debentures Test 1

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Question 1

Personal Account

Real Account

Nominal Account

None of these

Question 2

Secured and unsecured Debentures

Redeemable Debentures and Irredeemable Debentures

Convertible Debentures and Non-convertible Debentures

Registered Debentures and Bearer Debentures

Question 3

Rs$$2,400, Rs1,800, Rs 1,200, Rs 600$$

$$Rs 1,500, Rs 1,500, Rs 1,350, Rs 1,050, Rs 600$$

$$Rs1,200$$ each year

None of these

Question 4

Rs$$1,500$$ each year

Rs$$1,200$$ each year

Rs$$2,000, Rs 1,800, Rs 1,400, Rs 800$$

None of these

Question 5

Rs$$10,000$$

Rs$$30,000$$

Rs$$20,000$$

Rs$$40,000$$

Question 6

Rs$$6,750$$

Rs$$7,500$$

Rs$$7,875$$

Rs$$7,125$$

Solution

Question 7

Rs$$1,250$$

Rs$$1,875$$

Rs$$3,750$$

Rs$$5,000$$

Question 8

Personal Account

Real Account

Nominal Account

None of the above

Solution

Question 9

30

40

10

25

Question 10

Ex-interest price

Cum-interest price

Plus-interest price

Additional-interest price

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