Which of the following statements about debentures is FALSE?

(A) Debenture is a part of owned capital.
(B) Debentures cannot be converted into shares.
(C) Redeemable debentures are those debentures, which are payable on the expiry of the specific period.
(D) Debentures cannot be issued at a premium.

Choose the correct answer from the options given below:

(A), (B) and (D) only

The correct answer is Option (1) → (A), (B) and (D) only

• (A) Debenture is a part of owned capital. False → Debentures represent borrowed capital, not owned capital.

• (B) Debentures cannot be converted into shares. False → Some debentures are convertible debentures, which can be converted into shares.

• (C) Redeemable debentures are those debentures, which are payable on the expiry of the specific period. True → By definition, redeemable debentures are repaid at maturity.

• (D) Debentures cannot be issued at a premium. False → Debentures can be issued at par, premium, or discount.