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Home Questions TYVAK79T7A
Target Exam

CUET

Subject

Accountancy

Chapter

Issue and Redemption of Debentures

Question:

Match the following-

LIST 1 LIST 2
1) Debenture holder a) Collateral Security
2) Shareholders b) Reserves & Surplus
3) Secondary Security c) Owner
4) Securities Premium Reserve d) Creditors

 

Options:

1) d, 2) c, 3) a, 4) b

1) d, 2) a, 3) c, 4) b

1) c, 2) d, 3) a, 4) b

1) d, 2) c, 3) b, 4) a

Correct Answer:

1) d, 2) c, 3) a, 4) b

Explanation:
LIST 1 LIST 2
1) Debenture holder d) Creditors
2) Shareholders c) Owner
3) Secondary Security a) Collateral Security
4) Securities Premium Reserve b) Reserves & Surplus

 

A ‘share’ represents ownership of the company whereas a debenture is only acknowledgment of Debt. A share is a part of the owned capital whereas a debenture is a part of borrowed capital.A collateral security may be defined as a subsidiary or secondary or additional security besides the primary security when a company obtains a loan or overdraft from a bank or any other financial Institution.

Securities Premium Reserve is shown under the major head shareholders fund under subhead reserves and surplus.

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