Accounting for Debentures

23 solved questions from Class 12 Accountancy, each with the full working. Tap any question to see the step-by-step solution.

• 1 What is the primary topic or theoretical principle explored in 'Accounting for Debentures' (Class 12 ACCOUNTANCY)? medium MCQ Chapter Core Principle
• 2 Which key mechanism or analytical rule is highlighted in 'Accounting for Debentures'? medium MCQ Key Analytical Mechanism
• 3 What is the primary topic or principle explained in 'Accounting for Debentures' (Class 12 Accountancy)? medium MCQ Chapter Core Concept
• 4 Which key observation or fact is central to understanding 'Accounting for Debentures'? medium MCQ Key Fact & Mechanism
• 5 Why is the study of 'Accounting for Debentures' important for students of Class 12? medium MCQ Learning Significance
• 6 What is a common application or real-world example related to 'Accounting for Debentures'? medium MCQ Real World Application
• 7 What key takeaway should students retain after completing 'Accounting for Debentures'? medium MCQ Chapter Summary & Takeaway
• 8 A firm has 5 debentures of Rs 200,000 each, bearing 8% interest, issued at 96. The discount is to be amortized straight‑line over the 5‑year term. Calculate the total interest expense for the first year. medium 3 marks Amortization of discount on debentures
• 9 On the redemption date, a firm redeems 5,000 debentures of Rs 100 each at 105. Prepare the journal entry for this redemption. medium 2 marks Redemption of debentures at premium
• 10 Sunrise Ltd issues 12% debentures of Rs 1,00,000 each, 50 debentures, at 102. Issue costs are Rs 2,000 per debenture and a 5% discount on these costs is allowed. Determine (a) the amount to be shown in the Debentures Account and (b) the net proceeds received by the company. hard 5 marks Accounting for issue costs and discount on issue costs
• 11 A company issues 1,000 debentures of Rs 100 each at 98. What amount is credited to the Debentures Account? easy MCQ 1 mark Issue of debentures at discount
• 12 Alpha Ltd issues 20 debentures of Rs\,1,00,000 each, 12\% interest payable annually, at 101\% of face value. Issue expenses are Rs\,3,000 per debenture and the company receives a 10\% discount on these expenses. The debentures have a tenure of 8 years. Calculate: (a) the amount to be shown in the Debentures Account, (b) net cash received, (c) annual amortization of the discount on issue expenses, (d) total interest expense for the first year (including amortization). hard 5 marks Issue costs, discount on issue expenses and amortization
• 13 Which of the following statements correctly describes the accounting treatment for discount on issue of debentures? medium MCQ 2 marks Treatment of discount on issue of debentures
• 14 A company issues 500 debentures of Rs\,100 each at a discount of 2\%. What amount is credited to the Debentures Account? easy 2 marks Issue of debentures at discount
• 15 XYZ Ltd redeemed 3,000 debentures of Rs\,100 each on 31 Dec 2025. The debentures bear 10\% interest payable annually on 31 March. The redemption price is 104\% of face value and interest up to the redemption date is payable. Prepare the journal entry for the redemption, including interest. medium 3 marks Redemption of debentures at premium with accrued interest
• 16 A company issues 500 debentures of Rs 1,00,000 each at 102% of face value. Issue costs are Rs 3,000 per debenture and a 10% discount on these costs is allowed. Find (i) the amount to be credited to the Debentures Account and (ii) the net cash received by the company. medium 3 marks Issue costs and discount on issue costs
• 17 A company issues 2,000 debentures of Rs 500 each at 97% of face value. What amount is credited to the Debentures Account? easy 2 marks Discount on issue of debentures
• 18 A company issues 10 debentures of Rs 5,00,000 each, bearing 10% annual interest, at 99% of face value. Issue expenses are Rs 5,000 per debenture and a 20% discount on these costs is allowed. The debentures have a tenure of 5 years. Calculate: (a) the amount to be shown in the Debentures Account, (b) net cash received, (c) annual amortization of the discount on issue expenses, and (d) total interest expense for the first year including amortization. hard 5 marks Amortization of discount on issue costs and interest expense
• 19 Which of the following statements correctly describes the accounting treatment for a premium on issue of debentures? easy MCQ 1 mark Accounting for premium on issue
• 20 A firm issues 800 debentures of Rs 1,00,000 each at 104% of face value. Issue expenses are Rs 4,000 per debenture and the firm receives a 15% discount on these expenses. Find (i) the amount to be credited to the Debentures Account and (ii) the net cash received by the company. medium 2 marks Issue at premium with discounted expenses
• 21 A company issues 1,500 debentures of Rs 200 each at 96% of face value. What amount is credited to the Debentures Account? easy 1 mark Issue of debentures at discount
• 22 A company issues 10 debentures of Rs 5,00,000 each, bearing 9% interest, at 98% of face value. Issue expenses are Rs 6,000 per debenture and a 25% discount on these expenses is allowed. The tenure of the debentures is 6 years. Calculate: (a) the amount shown in the Debentures Account, (b) net cash received, (c) annual amortization of the discount on issue expenses, (d) total interest expense for the first year including amortization of both discount on issue price and discount on issue expenses. hard 4 marks Amortization of discounts on issue price and expenses
• 23 A company issues 2000 debentures of Rs 500 each at 95 % of face value. What amount is credited to the Debentures Account? easy 2 marks Debenture issue at discount