Explanation:

When debentures are issued as collateral security, it means that the debentures are pledged as security for a loan or other obligation. In this case, the debentures are not being issued for the purpose of raising capital, but rather to provide security to the lender.

There are different ways in which debentures can be issued as collateral security. One way is to issue the debentures to the lender and then immediately take them back as collateral. Another way is to issue the debentures to a third party who holds them as collateral on behalf of the lender.

In either case, an entry needs to be passed in the books of accounts. The question asks whether the entry should be:

a) Debenture Suspense A/c Dr. To Debentures A/c

b) No entry has to be made

c) Either (a) or (b)

d) None

The correct answer is (c) Either (a) or (b). This means that the entry can be made either by debiting the Debenture Suspense account and crediting the Debentures account or by not making any entry at all.

If the entry is made, it reflects the fact that the debentures have been issued as collateral security. This entry is a temporary one and will be reversed when the debentures are redeemed or released from the collateral.

If no entry is made, it means that the debentures are still recorded as an asset in the books of accounts. However, it is important to note that the debentures are not available for use as they have been pledged as collateral.

Conclusion:

In conclusion, when debentures are issued as collateral security, an entry may or may not be made in the books of accounts. If an entry is made, it is a temporary one and will be reversed when the debentures are redeemed or released from the collateral. If no entry is made, it means that the debentures are still recorded as an asset in the books of accounts.