Class 12 Accountancy - Company Accounts and Analysis of Financial Statements - Chapter Issue and Redemption of Debentures NCERT Solutions | Describe the meaning of ‘Debenture
Describe the meaning of ‘Debenture Issued as Collateral Securities’. What accounting treatment is given to the issue of debentures in the books of accounts?
Debentures issued as collateral security is secondary or parallel security for the original loan taken by the company. The lender can realize the collateral security in case borrower fails to make the payment of the original loan. In this article, we will learn more about the debentures issued as collateral security and accounting treatment.
Debentures issued as Collateral Security
Collateral means secondary. Thus, collateral security refers to supporting or secondary security for a loan. In case the borrower fails to pay the original loan amount on the due date, the lender can sell the collateral security to realize the amount of loan.
Usually, the borrower places a particular asset or a group of assets as collateral security. When he fails to pay the loan, these assets are sold and the loan is paid from the sale proceeds.
More Questions From Class 12 Accountancy - Company Accounts and Analysis of Financial Statements - Chapter Issue and Redemption of Debentures
- Q:- What is meant by a Debenture?
- Q:-
State the meaning of ‘Debentures issued as a collateral security’.
- Q:-
What is ‘Capital Reserve’?
- Q:-
Can the company purchase its own debentures?
- Q:-
What is discount on issue of debentures?
- Q:-
Explain the guidelines of SEBI for creating Debenture Redemption Reserve.
- Q:-
What is meant by ‘Issue of debenture at discount and redeemable at premium?
- Q:-
What is a ‘Convertible Debenture’?
- Q:-
Describe the steps for creating Sinking Fund for redemption of debentures.
- Q:-
Explain the different types of debentures?
Popular Questions of Class 12 Accountancy - Company Accounts and Analysis of Financial Statements
- Q:-
What do you mean by Ratio Analysis?
- Q:-
List the techniques of Financial Statement Analysis.
- Q:-
State the meaning of financial statement analysis?
- Q:-
What are various types of ratios?
- Q:-
Distinguish between Vertical and Horizontal Analysis of financial data.
- Q:-
What are limitations of financial statement analysis?
- Q:-
What relationships will be established to study?
(a) Inventory Turnover (b) Debtor Turnover
(c) Payables Turnover (d) Working Capital Turnover - Q:-
State the meaning of Analysis and Interpretation.
- Q:-
List any three objectives of analysing financial statements?
- Q:-
The liquidity of a business firm is measured by its ability to satisfy itslong-
term obligations as they become due. What are the ratios used forthis purpose?
Recently Viewed Questions of Class 12 Accountancy - Company Accounts and Analysis of Financial Statements
- Q:-
The average age of inventory is viewed as the average length of time inventory is held by the firm or as the average number of days’ sales in inventory. Why?
- Q:-
The current ratio provides a better measure of overall liquidity only when a
firm’s inventory cannot easily be converted into cash. If inventory is liquid, the
quick ratio is a preferred measure of overall liquidity. Explain. - Q:-
State the importance of Financial Analysis?
- Q:-
Distinguish between Vertical and Horizontal Analysis of financial data.
- Q:-
What are liquidity ratios? Discuss the importance of current and liquid ratio.
- Q:-
Explain the process of preparing income statement and balance sheet.
- Q:-
How would you study the Solvency position of the firm?
- Q:-
Prepare the format of statement of profit and loss and explain its items.
- Q:-
What is the importance of comparative statements? Illustrate youranswer with particular reference to comparative income statement.
- Q:-
State the meaning of Analysis and Interpretation.
- All Chapters Of Class 12 Accountancy - Company Accounts and Analysis of Financial Statements
- All Subjects Of Class 12