Company Accounts Issue Of Debentures CBSE Questions & Answers

Company Accounts Issue Of Debentures

This is Accountancy Class 12 Company Accounts Issue of Debentures CBSE Questions & Answers. There are 15 questions in this test with each question having around four answer choices.

Questions & Answers

1
When a company purchases some assets and issues debentures as a payment for the purchase, to the vendors it is known as issue of
  • A
    Debentures issued for consideration other than cash
    Correct
  • B
    Debentures issued as collateral security
  • C
    Debentures issued for cash
  • D
    All of these
2
While passing the journal entry for the purchase of assets from vendor which account should be credited
  • A
    Assets A/c
  • B
    Debenture A/c
  • C
    Discount A/c
  • D
    Vendor A/c
    Correct
3
Debenture holders are the _________
  • A
    Debtors of the company
  • B
    Owner of the company
  • C
    None of these
  • D
    Creditors of the company
    Correct
4
10 percent debenture of nominal value of Rs.100 has been issued at Rs.90 is said to be issued at
  • A
    Premium
  • B
    None
  • C
    Discount
    Correct
  • D
    Par
5
9 percent debenture of a nominal value of Rs.100 has been issued at Rs.120 debentures are said to be issued at...........................
  • A
    Par
  • B
    Premium
    Correct
  • C
    All
  • D
    Discount
6
A company can issue its debentures at a discount if a provision in this regard has been made in its ...........................
  • A
    Memorandum of association
  • B
    No provision needed
  • C
    Article of association
    Correct
  • D
    Both
7
Name the security which is issued in addition to the principal security
  • A
    Collateral security
    Correct
  • B
    Principal security
  • C
    Both
  • D
    None
8
Which account is debited while making a journal entry in the books of the company on issue of debentures as collateral security
  • A
    Debenture holder A/c
  • B
    Suspense A/c
    Correct
  • C
    Share A/c
  • D
    Debenture A/c
9
On which side of the balance sheet of a company issuing debentures as collateral security is written the Debentures Suspense A/c?
  • A
    Equity
  • B
    Creditors
  • C
    Assets
    Correct
  • D
    Liabilities
10
When does a company issue debentures as collateral security
  • A
    When lender does not demands additional security
  • B
    When lender does not gives additional security
  • C
    When lender gives additional security
  • D
    When lender demands additional security
    Correct
11
Why is the amount of Discount on Issue of Debentures written in the Balance sheet
  • A
    It is treated as capital loss
    Correct
  • B
    It is treated as Fixed loss
  • C
    It is treated as current loss
  • D
    None of these
12
Discount on issue of debentures is a _______
  • A
    Revenue gain
  • B
    Capital loss
    Correct
  • C
    Capital gain
  • D
    Revenue loss
13
The loss on issue of debentures is
  • A
    fictitious asset
    Correct
  • B
    Fixed asset
  • C
    Fixed liability
  • D
    fictitious Liability
14
When debentures are redeemed after fixed period here loss is spread equally over life of debenture therefore called
  • A
    Proportion Method
  • B
    None of these
  • C
    equal installment method
    Correct
  • D
    variable installment method
15
Calculation of Loss on issue of Debentures Account
  • A
    \({\text{Amount }} \times \frac{{100}}{{rate}}\)
  • B
    \({\text{Amount }} \times \frac{{rate}}{{110}}\)
  • C
    \({\text{Amount }} \times \frac{{rate}}{{100}}\)
    Correct
  • D
    \({\text{Amount }} \times \frac{{110}}{{rate}}\)