Question

Objective type questions.
Answer in are sentence only.

What is meant by redemption of Debentures?

Answer 1

Repayment of the principal amount of debentures is known as redemption of debentures. It can be at a premium, discount or par. The conditions about redemption are stipulated at the time of issue of debentures. That is, whether redemption is to be made at a price above its face value (at a premium), or at par, i.e. at face value, or at a price below the face value (i.e. redemption at discount) is decided at the time of issue of the debentures.