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Direction: Choose the correct answer to the following questions from the given alternatives:
Debentures can be redeemed out of:
- a)Profits.
- b)Capital.
- c)Provisions made for redemption.
- d)All of the above.
Correct answer is option 'D'. Can you explain this answer?
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Direction: Choose the correct answer to the following questions from t...
Debentures Redemption:
- Profits: Debentures can be redeemed using profits earned by the company. This is a common source of funds for redemption as it does not require any additional capital infusion.
- Capital: In some cases, debentures can also be redeemed using the capital of the company. However, this should be done cautiously as it may impact the financial stability of the company.
- Provisions made for redemption: Companies often set aside provisions specifically for the redemption of debentures. These provisions ensure that there are enough funds available for redemption when the debentures mature.
- All of the above: In conclusion, debentures can be redeemed out of profits, capital, and provisions made for redemption. It is essential for companies to have a well-defined strategy for debenture redemption to ensure financial stability and investor confidence.
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Direction: Choose the correct answer to the following questions from t...
Explanation:
Debentures Redemption:
Debentures can be redeemed out of the following sources:
a) Profits:
Debentures can be redeemed using the profits earned by the company. If the company has generated sufficient profits, it can utilize these profits to redeem the debentures.
b) Capital:
In some cases, companies may choose to redeem debentures using a portion of their capital. This is a less common method of redemption as it involves using the company's own funds.
c) Provisions made for redemption:
Companies often set aside provisions for the redemption of debentures. These provisions are created by allocating a portion of the company's profits towards the redemption of debentures in the future.
d) All of the above:
The correct answer is 'All of the above' because debentures can be redeemed out of profits, capital, and provisions made for redemption. Companies have the flexibility to choose the most appropriate source based on their financial situation and strategic objectives.
In conclusion, debentures can be redeemed out of profits, capital, and provisions made for redemption, providing companies with various options to fulfill their obligations to debenture holders.
Debentures Redemption:
Debentures can be redeemed out of the following sources:
a) Profits:
Debentures can be redeemed using the profits earned by the company. If the company has generated sufficient profits, it can utilize these profits to redeem the debentures.
b) Capital:
In some cases, companies may choose to redeem debentures using a portion of their capital. This is a less common method of redemption as it involves using the company's own funds.
c) Provisions made for redemption:
Companies often set aside provisions for the redemption of debentures. These provisions are created by allocating a portion of the company's profits towards the redemption of debentures in the future.
d) All of the above:
The correct answer is 'All of the above' because debentures can be redeemed out of profits, capital, and provisions made for redemption. Companies have the flexibility to choose the most appropriate source based on their financial situation and strategic objectives.
In conclusion, debentures can be redeemed out of profits, capital, and provisions made for redemption, providing companies with various options to fulfill their obligations to debenture holders.
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Direction: Choose the correct answer to the following questions from the given alternatives:Debentures can be redeemed out of:a)Profits.b)Capital.c)Provisions made for redemption.d)All of the above.Correct answer is option 'D'. Can you explain this answer?
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Direction: Choose the correct answer to the following questions from the given alternatives:Debentures can be redeemed out of:a)Profits.b)Capital.c)Provisions made for redemption.d)All of the above.Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Direction: Choose the correct answer to the following questions from the given alternatives:Debentures can be redeemed out of:a)Profits.b)Capital.c)Provisions made for redemption.d)All of the above.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Direction: Choose the correct answer to the following questions from the given alternatives:Debentures can be redeemed out of:a)Profits.b)Capital.c)Provisions made for redemption.d)All of the above.Correct answer is option 'D'. Can you explain this answer?.
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