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CBSE Questions for Class 12 Commerce Accountancy Issue And Redemption Of Debentures Quiz 2 - MCQExams.com

Debentures can be redeemed out of ___________.
  • profits
  • provisions
  • capital
  • all of the above
Premium on redemption of debentures account is recorded on issue of debentures.
  • A real account
  • A nominal account-income
  • A personal account
  • A nominal account-expenditure
Preference shares amounting to Rs. 2,00,000 are redeemed at a premium of 5% by issue of shares amounting to Rs. 1,00,000 at a premium of 10%. The amount to be transferred to capital redemption reserve ___________.
  • Rs. 1,05,000
  • Rs. 1,00,000
  • Rs. 2,00,000
  • Rs. 1,11,000
Which of the following statements is false?
  • Debenture is a form of borrowing fro public
  • Normal rate of interest on debentures is specified on issue
  • Debenture interest is a charge against profits
  • The issue price and redemption value of debentures will always be equal
Premium on redemption of debenture A/c is a _____.
  • personal A/c
  • real A/c
  • nominal A/c
  • suspense A/c
When debentures are issued at par and are redeemable at premium, the credit given to premium of redemption of debenture account is in the nature of.
  • Personal Account
  • Real Account
  • Nominal A/c
  • Nominal Account-Income
Debentures premium cannot be used to ____________.
  • write off the discount on issue of shares or debentures
  • write off the premium on redemption of shares or debentures
  • pay dividends
  • write off capital loss
In the Balance Sheet of a company, Debenture Premium Account appears under the head:
  • Share Capital
  • Reserves & Surplus
  • Non-Current Liabilities
  • Current Liabilities
Convertible Debentures are those debentures which are -
  • convertible into equity only at the point of debenture holders.
  • convertible into equity shares only at the option of company only.
  • convertible into equity shares only at the option of debenture holders or company.
  • convertible into any securities at the option of debenture holders or company.
A Ltd. took over the assets of Rs3,00,000 and liabilities of Rs10,000 of B Ltd. for an agreed purchase consideration of Rs2,70,000 to be satisfied by the issue of 15% Debentures of Rs100 each at 20% premium. Considering this, which of the following sentences is true?
  • Goodwill A/c is to be debited with Rs 20,000
  • Capital Reserve A/c is to be debited with Rs 20,000
  • Goodwill A/c is to be credited with Rs 20,000
  • Capital Reserve A/c is to be credited with Rs 20,000
Capital redemption reserve account is prepared when ___________.
  • redemption is done out of issue of fresh shares
  • redemption is done out of profits of the company
  • redemption is done through company's capital fund
  • All of the above
Debenture premium cannot be used to _________________.
  • write off the discount on issue of shares or debentures
  • write off the premium on redemption of shares or debentures
  • pay dividends
  • write off underwriting commission
Debenture Redemption Premium Account is a -
  • Personal Account
  • Real Account
  • Nominal Account
  • None of these
If preference share are redeemed at premium, then such premium may be provided out of the ____________. 
  • share premium account
  • share capital account
  • provision for tax
  • capital Redemption Reserve account
For a share of Rs.20 on which Rs.1.6 has been called but Rs.10 has been paid is forfeited, the share capital account should be debited by ___________. 
  • Rs.20
  • Rs.10
  • Rs.16
  • None of these
Preference share to be redeemed Rs.2,00,000 at a premium of 5%. Shares issued of Rs.1,00,000 at a premium of 10%. The amount to be transferred to capital redemption reserve is _________. 
  • Rs.1,00,000
  • Rs.1,10,000
  • Rs.2,00,000
  • Rs.1,05,000
A retail store sold gift certificates that are redeemable in merchandise. The gift certificates lapse one year after they are issued. How would the deferred revenue account be affected by each of the following?
Redemption of certificates
Lapse of certificates
  • Decrease, Decrease
  • Decrease, No effect
  • Increase, Decrease
  • No effect : No effect
Debentures cannot be redeemed out of :
  • Profits
  • Provision
  • Capital
  • All the above
Debentures can be redeemable at discount.
  • True
  • False
The Debenture Redemption Reserve account appears on the liability side of the balance sheet under the head ___________.
  • capital
  • reserves and surplus
  • non-current liabilty
  • current liability
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Practice Class 12 Commerce Accountancy Quiz Questions and Answers