Company X Ltd. is incurring huge losses; the Board of Directors are of the opinion that in case of losses, there is no need to pay interest to debenture holders. [RTP Jan. 2025]
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Company AccountsQ-6 | Issue of DebenturesQuestion 4905 of 112
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Detailed Solution & Explanation
False: Even if the company incurs losses, it has to pay interest on deben- tures. Debenture
being debts on the company & debenture holders are not concerned with the profit or loss
of the company, the interest is to be paid at the rate fixed on it at the time of issue of
debenture
About This Chapter: Partnership & Companies
Paper
Paper 1: Accounting
Weightage
15-20%
Key Topics
Admission, Retirement, Death, Shares, Debentures
This chapter covers Admission, Retirement, Death, Shares, Debentures and is part of Paper 1: Accounting in the CA Foundation exam.
View Official ICAI SyllabusExam Strategy Tip
This topic carries 15-20% weightage. Focus on understanding core concepts rather than memorizing.
Key Concepts to Understand
Related Comparison Tables
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Re-issue of forfeited shares is allotment of shares but not a sale. [May 2018, 2 Marks]
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