NCERT Class 12 Accountancy Part 2 Chapter 2 Issue and Redemption of Debentures Extra Questions and Answers
Class 12 Accountancy Part 2 Chapter 2 Extra Questions and Answers – Issue and Redemption of Debentures. Here in this Page Class XII Students can Learn Extra Questions & Answer 2nd Chapter Accountancy Part 2 Part I fully Inside.
We Provided Here Issue and Redemption of Debentures Accountancy Part 2 Chapter 2 MCQ Questions, Very Short Type Questions and Short Type Questions.
Class 12 Accountancy Part 2 Chapter 2 Extra Question with Answer – Issue and Redemption of Debentures
Accountancy Part 2 Chapter 2 Issue and Redemption of Debentures Class 12 Inside 3 marks, 2 Marks & And 1 Marks Important Questions and Answers.
Board |
NCERT |
Class |
12 |
Book Title |
Accountancy Part II |
Chapter |
2 |
Chapter Name |
Issue and Redemption of Debentures |
Topic |
Extra Questions |
VSAQ with solution NCERT (1 Mark)
(Q1) Define zero coupon Bond.
Ans: This type of bond does not carry any specific rate of interest it is used to compensate the investors and are issued at a discount.
(Q2) What is coupon rate?
Ans: Coupon rate is the rate of interest at which interest is paid by the company on its debentures.
(Q3) Give the journal entry for debenture issued as a collateral security.
Ans: Debenture suspense A/c Dr
To debentures A/c
(Q4) Why are irredeemable debentures also known as perpetual debentures?
Ans: These type of debentures are known as perpetual debentures because these are not repayable during the life span of the company.
(Q5) As an investor, why would you like to invest in shares rather than in debentures of a company?
Ans: It is preferable to invest in shares rather than in debentures because shares provide liquidity, and higher rate of return.
(Q6) Why is premium on the issue of debentures considered a capital profit?
Ans: It is considered as a capital profit because it is not an income arising from normal course of action.
(Q7) Do you think debentures are less riskier than shares? Give reason.
Ans: Yes debentures are less riskier than shares because debentures have priority over shares for repayment at the time of winding up of the company.
(Q8) Mention any one point of difference between “Premium on issue” and “Premium on redemption” of debentures.
Ans: “Premium on issue of debentures” is a capital profit, whereas “premium on redemption of debentures” is a capital loss.
(Q9) Why would an investor prefer to invest partly in shares and partly in debentures of a company?
Ans: An investor would like to invest partly in shares and partly in debentures because shares provide liquidity and debentures provide safety and assured interest.
(Q10) Why is premium on issue of debentures considered a capital profit?
Ans: “Premium on issue of debentures” is considered as a capital profit because it is an income. Which do not occur from normal course of business operations.
(Q11) What is the nature of “Interest on debentures”?
Ans: “Interest on debentures” is a item of charge against profit which means that it will be always paid by the company irrespective of the amount of profit earned.
In case you are missed :- NCERT Extra Questions for Financial Statements of a Company
(Q12) Give any one point of difference between shareholders and debenture holders.
Ans: Shareholders are the owners of the company whereas debenture holders are the lenders of the company.
(Q13) What is meant by unsecured debentures?
Ans: These are those type of debentures which are not given any security and the holders of an unsecured debentures are treated as unsecured creditor at the time of liquidation of company.
(Q14) Define redeemable debentures.
Ans: These type of debentures has to be repaid by the company at the end of a specified period.
(Q15) On the basis of security, how are the debentures classified?
Ans: On the basis o security of debentures, they are classified as of two type –
(i) “Secured debentures”.
(ii) “Unsecured debentures”
(Q16) Mention any two characteristics of debentures.
Ans: Any two characteristics of debentures are as follows:
(i) A debenture is issued under the seal of the company.
(ii) A debenture contains a contract for the repayment of principal sum at a specified date.
(Q17) Define debentures.
Ans: A debenture is a written acknowledgment of a debt taken by the company as they are issued under the seal of the company.
In case you are missed :- NCERT Extra Questions for Analysis of Financial Statements
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