A company had 5,000 Debentures of Rs 100 each. They took loan of Rs 10,00,000 from SBI and issued 12000, 10% Debentures of Rs 100 each as Collateral Security. How much amount will be shown in Balance sheet as Long term Borrowings ?
Answer & explanation
Correct answer: option 1
"Debentures issued = 5,00,000 + Secured Loan 10,00,000 = 15,00,000 will be shown as Long term borrowings .
No effect of Debentures issued as Collateral Security on Balance Sheet.