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mediumMCQCUET Accountancy 2025 30 May Shift 12026Accountancy
1 mark

Which of the following are the correct statements regarding debentures/debenture interest?(A) The payment of interest on debentures is a charge on the profits of the company.(B) Redeemable debentures are those debentures which are payable on the expiry of the specific period.(C) Debentures cannot be converted into shares.

  1. A
    (A), (C) and (D) only
  2. B
    (A), (B) and (D) only
  3. C
    (A), (B), (C) and (D)
  4. D
    (B), (C) and (D) only

Solution & Step-by-step Explanation

Let's assess the debenture statements:(A): True, debenture interest is a charge against profit and must be paid regardless of earnings.(B): True, redeemable debentures are explicitly repayable after a defined timeline.(C): False, convertible debentures can definitely be converted into equity shares.(D): True, perpetual debentures carry no fixed maturity date and are classified as irredeemable debentures.Therefore, statements (A), (B), and (D) are correct.

Practice this question

Try it yourself before checking the explanation above.

Which of the following are the correct statements regarding debentures/debenture interest?(A) The payment of interest on debentures is a charge on the profits of the company.(B) Redeemable debentures are those debentures which are payable on the expiry of the specific period.(C) Debentures cannot be converted into shares.
A
(A), (C) and (D) only
B
(A), (B) and (D) only
C
(A), (B), (C) and (D)
D
(B), (C) and (D) only

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