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Read the following information and answer the given questions:
Ajmera Ltd. raised the following loans in the year 2016-17:
12% Bank Loan from SBI on 1st April, 2016 ₹15,00,000
10,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016
The terms of the loans were :
(a) The Redemption of Debentures to begin from 30th September, 2017.
(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.
The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.
Under which head will the long term borrowings come?
- a)Current Liabilities
- b)Reserves and Surplus
- c)Non-current liabilities
- d)Notes to Accounts
Correct answer is option 'C'. Can you explain this answer?
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Read the following information and answer the given questions:Ajmera ...
Any liability that needs to be fulfilled not recently is called non-current liability.
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Read the following information and answer the given questions:Ajmera ...
Explanation:
The long-term borrowings raised by Ajmera Ltd. will come under the head of non-current liabilities.
Reason:
1. Bank Loan:
The bank loan raised by Ajmera Ltd. is a long-term borrowing, as it has a repayment period of more than one year. As per the information given, the loan was raised on 1st April, 2016 and the redemption date is not mentioned. However, since it is a bank loan, it is typically expected to be repaid over a period of more than one year. Therefore, it falls under the category of non-current liabilities.
2. Debentures:
The debentures raised by Ajmera Ltd. are also long-term borrowings. They are redeemable in 4 equal yearly installments, with the redemption period starting from 30th September, 2017. Since the redemption period extends beyond one year, these debentures are classified as non-current liabilities.
Interest Payments:
The interest on the bank loan is to be paid annually, while the interest on the debentures is to be paid half-yearly. However, as per the information given, the company has not paid the interest on both the bank loan and the debentures till the balance sheet date. This implies that the interest payments are currently outstanding and will be recorded as liabilities in the balance sheet.
Summary:
Based on the above analysis, it can be concluded that the long-term borrowings raised by Ajmera Ltd. will be classified under the head of non-current liabilities in the balance sheet. This includes the bank loan from SBI and the debentures issued by the company. The interest payments on both the bank loan and the debentures, which are currently outstanding, will also be recorded as liabilities in the balance sheet.
The long-term borrowings raised by Ajmera Ltd. will come under the head of non-current liabilities.
Reason:
1. Bank Loan:
The bank loan raised by Ajmera Ltd. is a long-term borrowing, as it has a repayment period of more than one year. As per the information given, the loan was raised on 1st April, 2016 and the redemption date is not mentioned. However, since it is a bank loan, it is typically expected to be repaid over a period of more than one year. Therefore, it falls under the category of non-current liabilities.
2. Debentures:
The debentures raised by Ajmera Ltd. are also long-term borrowings. They are redeemable in 4 equal yearly installments, with the redemption period starting from 30th September, 2017. Since the redemption period extends beyond one year, these debentures are classified as non-current liabilities.
Interest Payments:
The interest on the bank loan is to be paid annually, while the interest on the debentures is to be paid half-yearly. However, as per the information given, the company has not paid the interest on both the bank loan and the debentures till the balance sheet date. This implies that the interest payments are currently outstanding and will be recorded as liabilities in the balance sheet.
Summary:
Based on the above analysis, it can be concluded that the long-term borrowings raised by Ajmera Ltd. will be classified under the head of non-current liabilities in the balance sheet. This includes the bank loan from SBI and the debentures issued by the company. The interest payments on both the bank loan and the debentures, which are currently outstanding, will also be recorded as liabilities in the balance sheet.
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Read the following information and answer the given questions:Ajmera Ltd. raised the following loans in the year 2016-17:12% Bank Loan from SBI on 1st April, 2016 ₹15,00,00010,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016The terms of the loans were :(a) The Redemption of Debentures to begin from 30th September, 2017.(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.Under which head will the long term borrowings come?a)Current Liabilitiesb)Reserves and Surplusc)Non-current liabilitiesd)Notes to AccountsCorrect answer is option 'C'. Can you explain this answer?
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Read the following information and answer the given questions:Ajmera Ltd. raised the following loans in the year 2016-17:12% Bank Loan from SBI on 1st April, 2016 ₹15,00,00010,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016The terms of the loans were :(a) The Redemption of Debentures to begin from 30th September, 2017.(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.Under which head will the long term borrowings come?a)Current Liabilitiesb)Reserves and Surplusc)Non-current liabilitiesd)Notes to AccountsCorrect answer is option 'C'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Read the following information and answer the given questions:Ajmera Ltd. raised the following loans in the year 2016-17:12% Bank Loan from SBI on 1st April, 2016 ₹15,00,00010,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016The terms of the loans were :(a) The Redemption of Debentures to begin from 30th September, 2017.(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.Under which head will the long term borrowings come?a)Current Liabilitiesb)Reserves and Surplusc)Non-current liabilitiesd)Notes to AccountsCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Read the following information and answer the given questions:Ajmera Ltd. raised the following loans in the year 2016-17:12% Bank Loan from SBI on 1st April, 2016 ₹15,00,00010,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016The terms of the loans were :(a) The Redemption of Debentures to begin from 30th September, 2017.(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.Under which head will the long term borrowings come?a)Current Liabilitiesb)Reserves and Surplusc)Non-current liabilitiesd)Notes to AccountsCorrect answer is option 'C'. Can you explain this answer?.
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