Issue of Debentures as Collateral Security

Q.

How do you show a suspense account on a balance sheet?

Q.

Where are creditors shown in a balance sheet?

Q.

Debentures of a company can be issued :

1. For cash

2. For consideration other than cash

3. As a collateral security

4. Any of these

Q.

On the issue of debentures as collateral security, which account is credited?

1. Debentures A/c

2. Bank Loan Account

3. Debenture Holdings A/c

4. Debenture Suspense A/c

Q.

Are debtors a current asset?

Q.

The lender is entitled to interest on the debentures issued as collateral security. State True or False

1. False

2. True

Q.

Describe the meaning of ‘Debenture Issued as Collateral Securities’. What accounting treatment is given to the issue of debentures in the books of accounts?

Q.

The Debentures Suspense Account will appear on the ___side of the balance sheet.

1. None of these

2. Liability

3. Asset

4. Capital

Q.

On which side of trial balance will the Goodwill account appear?

Q.

State the meaning of 'Debentures issued as a Collateral Security'.

Q.

Can debentures be issued as a collateral security?

1. Nominal value of debentures

2. No interest is paid

3. Face value of debentures

4. Paid up value of debentures

Q. If Trial Balance shows excess credit, suspense account will show a debit balance.

1. True
2. False

Q.

The term _______ implies additional security given for a loan.

1. None of these

2. Extra security

3. Collateral security

4. Special security

Q.

When debentures are issued as a collateral security & No journal entry is made in the account books at the time of issue of such debentures, then debentures are shown by way of ___

1. None of the above

2. Accounting policies

3. Notes to accounts

4. Note below the loan amount

Q.

In case of collateral security, the lender has the ___right over the debentures until and unless the loan is repaid.

1. None of these

2. Absolute

3. Secondary

4. Primary

Q. In case of issue of debentures as collateral security, the effect in the Balance Sheet is nullified because balance of Debenture Suspense Account is deducted from Debentures Account.

1. True
2. False

Q. If the trial balance do not agree after transferring the balance of all ledger accounts including cash and bank balance and also errors are not located timely, then the trial balance is tallied by transferring the difference of debit and credit side to an account knows as_____________.

1. Suspense Account
2. Drawing Account
3. Memorandum Account
4. Capital Account

Q. The lender is entitled to only on the amount of loan, but not on the debentures issued as collateral security.

1. interest
2. dividend
3. shares
4. debentures

Q. Name the parties to a promissory note.

Q. There are _____ methods of recording issue of debentures as a collatral security.

1. 4
2. 1
3. 2
4. 3

Q. The secrecy and authenticity checks are robust in ______ softwares, and they offer high flexibility in terms of number of users.

1. Ready to use
2. Tailored
3. None of the above
4. Customized

Q.

What is meant by ‘Mortgaged Debentures’?

Q. Suspense Account is shown in the __________.

1. Trading and Profit and Loss Account
2. Income and Expenditure Account
3. None of the Above
4. Balance Sheet

Q. What is remainder theorem

Q. The main object of opening suspense account is ___________.

1. To tally the trial balace
2. To avoid the delay in the preparation of financial statements
3. None of these
4. To rectify the errors

Q. What is bioconditional statement

Q. Shares in physical form cannot be converted into electronic form.

1. True
2. False