CA Foundation Exam > CA Foundation Questions > Which of the following statements is true?a)A...
Start Learning for Free
Which of the following statements is true?
- a)A debenture holder is an owner of the company
- b)A debenture holder can get his money back only on the liquidation of the company
- c)A debenture issued at a discount can be redeemed at a premium
- d)A debenture holder receives interest only in the event of profits
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Which of the following statements is true?a)A debenture holder is an o...
Debentures are a type of long-term debt instrument that companies issue to raise funds from the public. They are generally secured against the assets of the company and carry a fixed rate of interest. In this context, the following statement is true:
A debenture issued at a discount can be redeemed at a premium.
Explanation:
When a company issues debentures at a price lower than their face value, it is said to be issuing them at a discount. For example, if a company issues debentures of face value Rs. 1000 at a price of Rs. 900, then it is said to be issuing them at a discount of Rs. 100. The difference between the face value and the issue price is known as the discount.
When such debentures are redeemed, the company may choose to pay the face value of the debenture or the issue price plus the discount. For example, if the company chooses to redeem the debentures at a premium of Rs. 50, then the debenture holders will receive Rs. 950 (i.e., Rs. 900 + Rs. 50) per debenture. This is known as redeeming the debentures at a premium.
Therefore, it can be concluded that a debenture issued at a discount can be redeemed at a premium.
A debenture issued at a discount can be redeemed at a premium.
Explanation:
When a company issues debentures at a price lower than their face value, it is said to be issuing them at a discount. For example, if a company issues debentures of face value Rs. 1000 at a price of Rs. 900, then it is said to be issuing them at a discount of Rs. 100. The difference between the face value and the issue price is known as the discount.
When such debentures are redeemed, the company may choose to pay the face value of the debenture or the issue price plus the discount. For example, if the company chooses to redeem the debentures at a premium of Rs. 50, then the debenture holders will receive Rs. 950 (i.e., Rs. 900 + Rs. 50) per debenture. This is known as redeeming the debentures at a premium.
Therefore, it can be concluded that a debenture issued at a discount can be redeemed at a premium.
Free Test
FREE
| Start Free Test |
Community Answer
Which of the following statements is true?a)A debenture holder is an o...
Debenture holder are not a real owner of company and the interest paid to them is charge on profit and they can not get their money only at the time of winding up
|
Explore Courses for CA Foundation exam
|
|
Top Courses for CA FoundationView all
Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer?
Question Description
Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer?.
Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer?.
Solutions for Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer?, a detailed solution for Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? has been provided alongside types of Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Which of the following statements is true?a)A debenture holder is an owner of the companyb)A debenture holder can get his money back only on the liquidation of the companyc)A debenture issued at a discount can be redeemed at a premiumd)A debenture holder receives interest only in the event of profitsCorrect answer is option 'C'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
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