Redemption of Debentures can be done by many ways. Identify the wrong option.
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Redemption of Debenture by giving tangible Assets
The book lists four methods of redeeming debentures: payment in lump sum, payment in instalments, purchase in the open market, and conversion into shares or new debentures. Handing over tangible assets to debentureholders is not one of them.
Option (1) Redemption of Debenture by Payment in Lumpsum — A method of redemption. The whole amount is paid at the end of the agreed period.
Option (3) Redemption of Debenture by payment in instalments — A method of redemption. The debentures are repaid in parts over a period.
Option (4) Redemption of Debenture by conversion into shares or new Debentures — A method of redemption. Debentureholders receive shares or new debentures instead of cash.
NCERT (2026-27 edition):
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