CBSE Class 12 Accountancy Issue Of Debentures MCQs Set B

Question: Debentures are shown in the balance sheet of the company under the head of:
a) Non-current liabilities
b) Current liability
c) Share capital
d) None of these
Answer: a

Question: A company issued 1000 7% Debentures of Rs.100 at 5% discount and repayable at 10% premium. What will be the amount of Loss on Issue of Debentures?
a) Rs.10,000
b) Rs.20,000
c) Rs.15,000
d) Rs.30,000
Answer: c

Question: Perpetual Debenture is the other name of:
a) Convertible debenture
b) Irredeemable debenture
c) Naked debenture
d) None of the above
Answer: b

Question: At the time of issue of debentures, Debentures A/c is:
a) Credited by the amount received
b) Credited by the issue price of the debentures
c) Credited by the nominal value of the debentures
d) None of the above
Answer: c

Question: Which of the following do not have voting rights in the company?
a) Debentureholders
b) Shareholders
c) Both a & b
d) None of these
Answer: a

Question: A Ltd took over assets of Rs.5,00,000 and liability of Rs.50,000 from B Ltd in the agreed consideration of Rs.4,80,000 and issued debentures of Rs.100 each at a premium of Rs.20. The number of debentures issued are:
a) 40,000
b) 48,000
c) 4,000
d) 4,800
Answer: a

Question: Return on debenture is called:
a) Interest
b) Dividend
c) Both a & b
d) None of the above
Answer: a

Question: State Bank of India redeemed 10,000 5% Debentures of Rs.100 each at 10% premium. What amount will be transferred to Debenture Redemption Reserve (DRR)?
a) Rs.2,50,000
b) Rs.5,00,000
c) Rs.10,00,000
d) Nil
Answer: d

Question: Debentureholder accounts are:
a) Personal
b) Real
c) Nominal
d) None of the above
Answer: a

Question: Global Ltd is to redeem 10,000 10% debentures of Rs.100 each on 30th June 2007. How much amount should be transferred to DRR?
a) Rs.2,50,000
b) Rs.1,00,000
c) Rs.5,00,000
d) Nil
Answer: a

Question: TP Ltd decided to redeem 1,000 10% debentures of Rs.100 each redeemable at 10% premium. The company will have to invest in specified securities at least:
a) Rs.15,000
b) Rs.16,500
c) Rs.25,000
d) Rs.27,500
Answer: a

Question: Premium payable on redemption of debentures is in the nature of:
a) Liability account
b) Assets account
c) Expense account
d) None of the above
Answer: c

Question: Discount or loss on issue of debentures to be written off after 12 months from the date of balance sheet or after the period of operating cycle is shown as:
a) Other current assets
b) Other non-current assets
c) Other long-term liability
d) Other current liabilities
Answer: c

Question: In case debentures of Rs.10,000 are issued at par but redeemable at a premium of 10%, the premium payable is debited to:
a) Debenture suspense account
b) Premium on redemption of debentures
c) Loss on issue of debentures
d) a & b both
Answer: b

Question: The provision of Companies Act 2013 in respect of redemption of debentures is to protect the interest of:
a) Debentureholders
b) Creditors
c) Shareholders
d) Bank
Answer: a

Question: When the number of debentures applied is less than the number of debentures offered to the public, the issue is said to be:
a) Oversubscribed
b) Under subscribed
c) Fully subscribed
d) None of the above
Answer: b

Question: 10% debenture issued at Rs 105 is repayable at Rs 110, the face value of debenture being Rs 100. Calculate the amount of loss on redemption of debentures:
a) 10
b) 5
c) 15
d) 25
Answer: c

Question: Maximum limit on premium on issue of debentures is:
a) 10%
b) 20%
c) 15%
d) No limit
Answer: d

Question: A Ltd decided to redeem 2,000 9% debentures of Rs.100 each on 31st December 2018. The company should invest in specified securities on or before:
a) 30th April 2017
b) 30th April 2018
c) 31st December 2017
d) 31st December 2018
Answer: a

Question: ABC Ltd purchased machinery worth Rs.1,98,000. The payment was made by issue of debentures of Rs.100 each at 10% discount. The number of debentures issued will be:
a) 1,100
b) 2,200
c) 3,300
d) 4,400
Answer: b

Question: X Ltd purchased a building and debentures were issued at discount. Which account will be debited for discount?
a) Discount on issue of debentures
b) Loss on issue of debentures
c) a or b, any one can be
d) None of the above
Answer: a

Question: Debenture holders are:
a) Owners of the company
b) Lenders of the company
c) Vendors of the company
d) Customers of the company
Answer: b

Question: B Ltd decided to redeem 10,000 10% debentures of Rs.100 each on 30th June 2017. The company should invest in specified securities on or before:
a) 30th April 2016
b) 30th April 2015
c) 30th June 2016
d) 30th April 2017
Answer: a

Question: Debentures that do not carry any charge or security on assets of the company are known as:
a) Secured debentures
b) Unsecured debentures
c) Convertible debentures
d) Registered debentures
Answer: b

Question: A company can issue debentures:
a) For cash
b) As a collateral security
c) For consideration other than cash
d) Any of the above
Answer: d

Question: Excess value of net assets over purchase consideration at the time of purchase of business is credited to:
a) General reserve
b) Capital reserve
c) Vendor’s account
d) Goodwill account
Answer: b

Question: Debenture is:
a) Written instrument acknowledging a debt written by its holder
b) An oral acknowledgement of debt by a company
c) A written instrument acknowledging a debt written by its company
d) None of these
Answer: c

Question: A Company issued 5,000 12% Debentures of Rs 100 each at 10% Discount and repayable at 10% Premium. Interest on Debentures is payable half-yearly on which tax is deducted at source of 10% p.a. What will the amount of tax deduction of a year?
a) Rs 3,000
b) Rs 4,000
c) Rs 5,000
d) Rs 6,000
Answer: d

Question: ABC took over the assets of Rs 7,60,000 and liabilities of Rs 80,000 of Y Ltd for purchase consideration of Rs 5,85,000 payable by the issue of 12% debentures of Rs100 each at a discount of 10%. The number of debentures to be issued is:
a) 6,600
b) 6,500
c) 4,500
d) 5,400
Answer: c

Question: United Ltd is to redeem 40,000 10% Debentures of Rs 100 each on 31st December 2017. How much amount should it invest in specified securities?
a) Rs 6,00,000
b) Rs 10,00,000
c) Rs 5,00,000
d) NIL
Answer: b

Question: Debentures issued as collateral security will be ________ to debenture suspense account:
a) Debited
b) Credited
c) Sometimes debited and sometimes credited
d) None of these
Answer: a

Match The Column

Question:
1. First stage of company in corporation                                          a) Capital subscription
2. After getting the name of the proposed company approved        b) Promotion
                                                                                                         c) Commencement of business
                                                                                                        d) Incorporation or registration

Question:
1. A Company can issue shares              a) For cash

                                                                b) For considering other than cash
                                                                c) Both (a) and (b)
Answer: [ 1-c ]

Question:
1. Shares issued at face value                        a) At discount
2. Shares issued at more than face value       b) At par
                                                                         c) At premium
Answer: [ 1 – b, 2 – c]

Question:
1. Amount not paid by the shareholder is        a) Calls in arrear
                                                                         b) Calls in advance
Answer: [ 1-a ]

Question:
1. What is the treatment of forfeiture in balance sheet       a) Added
                                                                                            b) Deducted
Answer: [ 1-a ]