MCQ Questions on Debentures

MCQ Questions on Debentures: Below, You will find a list of Commerce MCQ Questions as per the latest prescribed syllabus. Ace up your preparation with the Objective Questions available on Debentures and enhance your subject knowledge. Understand the concept clearly by consistently practicing the Multiple Choice Questions and score well in your exams.

MCQ Questions on Debentures

1. Debenture holders are
(a) Debtors of the Company
(b) Creditors of the Company
(c) Debtors of the Company
(d) Owners of the Company

Answer

Answer: (b)


2. Debentures indicate the
(a) Short-term Borrowings of a Company
(b) Directors’ shares in a company
(c) The Investment of Equity-Shareholders
(d) Long-term Borrowings of a Company

Answer

Answer: (d)


3. In debenture, interest payable is
(a) Transferred to general reserve
(b) Transferred to falling fund investment account
(c) Charged against the firm’s profits
(d) Appropriation of the company’s profits

Answer

Answer: (c)


4. The owner of the debenture is qualified for
(a) Fixed-rate interest
(b) Company’s voting rights
(c) Firm’s Profits share
(d) Fixed dividend

Answer

Answer: (a)


5. On company liquidation, the principal amount of debentures is returned
(a) After Equity Capital
(b) Before Equity Capital
(c) Last of All
(d) First of All

Answer

Answer: (b)


6. Which of the below-mentioned statement is not true?
(a) The issue price and redemption value of debentures cannot differ
(b) Interest on debenture is a charge against profits
(c) It is common to prefix debentures with the agreed interest rate
(d) A debenture is a kind of public borrowing

Answer

Answer: (a)


7. Point out the false statements
(a) A firm can buy its own debentures and shares.
(b) A Company can issue convertible debentures.
(c) A business can issue debentures with voting rights.
(d) An organization can issue redeemable debentures.

Answer

Answer: (c)


8. Which options are not a feature of Bearer Debentures?
(a) The interest is paid to the holder irrespective of identity
(b) It is transferred by mere delivery.
(c) The transfer of bearer debenture requires transfer deed
(d) It is a negotiable tool.

Answer

Answer: (c)


9. Debenture Application A/c is in the form of
(a) Current Account
(b) Nominal Account
(c) Personal Account
(d) Real Account

Answer

Answer: (c)


10. The form of a discount on issue of Debentures is in the nature of
(a) Deferred Revenue Expenditure
(b) Capital loss
(c) Revenue loss
(d) None of the above

Answer

Answer: (b)


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