Practicing Success
There are two statements marked as Assertion (A) and Reason (R). Mark your answer as per the options given below. Assertion (A): Debentures of the company are an instrument acknowledging a investment. |
Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion(A). Both Assertion (A) and Reason (R) are true, but ( A ) Reason (R) is not the correct explanation of Assertion (A). Assertion (A) is false but Reason(R) is true Assertion (A) is true, but Reason (R) is false. |
Assertion (A) is false but Reason(R) is true |
The correct answer is option 3- Assertion (A) is false but Reason(R) is true. Assertion (A): Debentures of the company are an instrument acknowledging a investment. THIS IS FALSE as debentures is a debt. Debenture is a written instrument acknowledging a debt under the common seal of the company. It contains a contract for repayment of principal after a specified period or at intervals or at the option of the company and for payment of interest at a fixed rate payable usually either half-yearly or yearly on fixed dates. A debenture is one of the most typical forms of long term loans that a company can take. It is normally a loan that should be repaid on a specific date. The majority of debentures come with a fixed interest rate. |