16. Which of the following statements is incorrect about debentures:
a) Debenture holders are the creditors of a company
b) Debentures can be issued to vendors at discount
c) Interest on debentures is an appropriation of profits
d) Interest is not paid on Debentures issued as Collateral Security
17. Assertion - Debentures saves income tax.
Reason - Interest on debenture is tax deductible expenditure.
a) Both Assertion and Reason are true, Reason is the correct explanation of Assertion
b) Assertion is correct but Reason is incorrect
c) Assertion is incorrect but Reason is correct
d) Both Assertion and Reason incorrect.
18. Assertion - Balance in debentures Interest Account is transferred to Statement of Profit & Loss at the end of the year
Reason - Interest on Debenture is charge against profit
a) Assertion is correct but Reason is incorrect
b) Assertion is incorrect but Reason is correct
c) Both Assertion and Reason are incorrect.
d) Both Assertion and Reason are correct, Reason is the correct explanation of Assertion
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Class 12 Accountancy MCQs Debentures -
Answers
- c) will not be entitled to interest on such debentures.
- b) ₹10,00,000
- c) 10,000
- c) loss on issue of debentures account
- d) all of the above
- c) Debentures cannot be converted into shares.
- b) ₹40,000
- a) ₹50,000
- c) Interest is not paid on Debentures issued as Collateral Security
- a) ₹10,00,000
- b) Capital Reserve is to be credited with ₹20,000
- d) ₹7,50,000
- b) 300 Debentures, ₹2,400
- b) ₹24,00,000
- a) ₹10,00,000
- c) Interest on debentures is an appropriation of profits
- a) Both Assertion and Reason are true, Reason is the correct explanation of Assertion
- d) Both Assertion and Reason are correct, Reason is the correct explanation of Assertion
Class 12 Accountancy MCQs Share Capital