Commerce Exam > Commerce Questions > Directions : In the following questions, a s...
Start Learning for Free
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.
Reason (R): Debentures are short-term loans taken from the public.
- a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
- b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
- c)Assertion (A) is true, but Reason (R) is false .
- d)Assertion (A) is false, but Reason (R) is true.
Correct answer is option 'C'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Verified Answer
Directions : In the following questions, a statement of Assertion (A)...
If a company needs funds for extension and development purposes without increasing its share capital, it can borrow from the general public by issuing certificates called debentures for a fixed period of time and at a fixed rate of interest. Debenture is a long-term debt instrument.
View all questions of this test
Most Upvoted Answer
Directions : In the following questions, a statement of Assertion (A)...
Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.
Reason (R): Debentures are short-term loans taken from the public.
The correct answer is option 'C' - Assertion (A) is true, but Reason (R) is false.
Explanation:
Debenture holders are indeed the creditors of the company, but the reason provided is incorrect because debentures are not necessarily short-term loans. Let's understand each statement in detail.
Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.
Debentures are long-term debt instruments issued by companies to borrow money from the public. When individuals or institutions purchase debentures, they become creditors of the company. As creditors, they are entitled to receive regular interest payments from the company at a fixed rate. This interest payment is a contractual obligation of the company and must be paid to the debenture holders.
Reason (R): Debentures are short-term loans taken from the public.
This reason is incorrect. Debentures are not necessarily short-term loans. In fact, debentures are typically long-term in nature, usually with a maturity period of more than one year. Unlike short-term loans, debentures are not repaid in a lump sum. Instead, they are repaid over the tenure of the debenture through regular interest payments and the principal amount at the end of the maturity period.
Conclusion:
While Assertion (A) is true because debenture holders are indeed the creditors of the company carrying a fixed rate of interest, Reason (R) is false because debentures are not short-term loans. Therefore, the correct answer is option 'C' - Assertion (A) is true, but Reason (R) is false.
Reason (R): Debentures are short-term loans taken from the public.
The correct answer is option 'C' - Assertion (A) is true, but Reason (R) is false.
Explanation:
Debenture holders are indeed the creditors of the company, but the reason provided is incorrect because debentures are not necessarily short-term loans. Let's understand each statement in detail.
Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.
Debentures are long-term debt instruments issued by companies to borrow money from the public. When individuals or institutions purchase debentures, they become creditors of the company. As creditors, they are entitled to receive regular interest payments from the company at a fixed rate. This interest payment is a contractual obligation of the company and must be paid to the debenture holders.
Reason (R): Debentures are short-term loans taken from the public.
This reason is incorrect. Debentures are not necessarily short-term loans. In fact, debentures are typically long-term in nature, usually with a maturity period of more than one year. Unlike short-term loans, debentures are not repaid in a lump sum. Instead, they are repaid over the tenure of the debenture through regular interest payments and the principal amount at the end of the maturity period.
Conclusion:
While Assertion (A) is true because debenture holders are indeed the creditors of the company carrying a fixed rate of interest, Reason (R) is false because debentures are not short-term loans. Therefore, the correct answer is option 'C' - Assertion (A) is true, but Reason (R) is false.
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Similar Commerce Doubts
Top Courses for CommerceView all
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer?
Question Description
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct 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 Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct 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 Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer?.
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct 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 Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct 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 Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer?.
Solutions for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer?, a detailed solution for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer? has been provided alongside types of Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debenture holders are the creditors of the company carrying a fixed rate of interest.Reason (R): Debentures are short-term loans taken from the public.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'C'. Can you explain this answer? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup