Test: Issue and Redemption of Debentures- Case Based Type Questions


8 Questions MCQ Test Accountancy Class 12 | Test: Issue and Redemption of Debentures- Case Based Type Questions


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Attempt Test: Issue and Redemption of Debentures- Case Based Type Questions | 8 questions in 16 minutes | Mock test for Commerce preparation | Free important questions MCQ to study Accountancy Class 12 for Commerce Exam | Download free PDF with solutions
QUESTION: 1

Read the following information and answer the given questions:

Charan Ltd. took over Assets of ₹6,00,000 and Liabilities of ₹40,000 of Paras Ltd. at an agreed value of ₹6,30,000. Charan Ltd. issued 10% Debentures of ₹100 each at a discount of 10% to Paras Ltd. in full satisfaction of the price. Charan Ltd. writes off any capital losses incurred during a year, at the end of that financial year.

Q. Which amount of interest will be paid by Charan Ltd. to Paras Ltd.?

Solution: 10% of ₹7,00,000 = ₹70,000
QUESTION: 2

Read the following information and answer the given questions:

Charan Ltd. took over Assets of ₹6,00,000 and Liabilities of ₹40,000 of Paras Ltd. at an agreed value of ₹6,30,000. Charan Ltd. issued 10% Debentures of ₹100 each at a discount of 10% to Paras Ltd. in full satisfaction of the price. Charan Ltd. writes off any capital losses incurred during a year, at the end of that financial year.

Q. What is the amount of discount given to Paras Ltd. on the issue of debentures?

Solution: ₹7,00,000 – ₹6,30,000 = ₹70,000
QUESTION: 3

Read the following information and answer the given questions:

Charan Ltd. took over Assets of ₹6,00,000 and Liabilities of ₹40,000 of Paras Ltd. at an agreed value of ₹6,30,000. Charan Ltd. issued 10% Debentures of ₹100 each at a discount of 10% to Paras Ltd. in full satisfaction of the price. Charan Ltd. writes off any capital losses incurred during a year, at the end of that financial year.

Q. In which account is the difference between the assets and liabilities taken over and the payment made be transferred to?

Solution: Goodwill is an intangible asset that is associated with the purchase of one company by another. Specifically, goodwill is the portion of the purchase price that is higher than the sum of the net fair value of all of the assets purchased in the acquisition and the liabilities assumed in the process.
QUESTION: 4

Read the following information and answer the given questions:

Charan Ltd. took over Assets of ₹6,00,000 and Liabilities of ₹40,000 of Paras Ltd. at an agreed value of ₹6,30,000. Charan Ltd. issued 10% Debentures of ₹100 each at a discount of 10% to Paras Ltd. in full satisfaction of the price. Charan Ltd. writes off any capital losses incurred during a year, at the end of that financial year.

Q. As Charan Ltd. writes off the capital losses where will the discount on issue of debentures be transferred to?

Solution: Discount on issue of debentures is a capital loss and over a period of 3 to 5 years or is charged to “Securities Premium Account” as per the guidelines issued by ICAI. The discount on issue of debentures can be written-off either by debiting it to profit and loss or to securities premium account.
QUESTION: 5

Analyse the case given below and answer the questions that follow :

Nikhil Technologies Ltd. issued 5,000; 9% Debentures of ₹100 each at a premium of ₹20 payable as follows:

(i) ₹40 including premium of ₹10 on application

(ii) ₹40 including premium of ₹10 on allotment

(iii) Balance as first and final call.

Applications were received for 5,000 debentures and allotment was made to all the applicants. All the calls were made, and amounts received.

Q. What is the total interest payable on the debentures issued?

Solution: ₹50,000 x 9 / 100 = ₹45,000
QUESTION: 6

Analyse the case given below and answer the questions that follow :

Nikhil Technologies Ltd. issued 5,000; 9% Debentures of ₹100 each at a premium of ₹20 payable as follows:

(i) ₹40 including premium of ₹10 on application

(ii) ₹40 including premium of ₹10 on allotment

(iii) Balance as first and final call.

Applications were received for 5,000 debentures and allotment was made to all the applicants. All the calls were made, and amounts received.

Q. What amount of the money received in application is transferred to the securities premium reserve account:

Solution: 5000 × ₹10 = ₹50,000
QUESTION: 7

Analyse the case given below and answer the questions that follow :

Nikhil Technologies Ltd. issued 5,000; 9% Debentures of ₹100 each at a premium of ₹20 payable as follows:

(i) ₹40 including premium of ₹10 on application

(ii) ₹40 including premium of ₹10 on allotment

(iii) Balance as first and final call.

Applications were received for 5,000 debentures and allotment was made to all the applicants. All the calls were made, and amounts received.

Q. The amount of money received during application is:

Solution: 5000 × ₹40 = ₹2,00,000
QUESTION: 8

Analyse the case given below and answer the questions that follow :

Nikhil Technologies Ltd. issued 5,000; 9% Debentures of ₹100 each at a premium of ₹20 payable as follows:

(i) ₹40 including premium of ₹10 on application

(ii) ₹40 including premium of ₹10 on allotment

(iii) Balance as first and final call.

Applications were received for 5,000 debentures and allotment was made to all the applicants. All the calls were made, and amounts received.

Q. The is the balance amount per debenture to be received at the first and final call is:

Solution: The balance amount per debenture to be received at the first and final call is ₹40.
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