Question

State with reasons whether the following statements are True and False :
Convertible debentures can be converted into equity shares.

• A. True
• B. False

Answer 1

The correct option is A True

True.
Reason :-
(1) Convertible Debentures are those which can be converted either partly or wholly into equity shares after the completion of a definite period.
(2) The rate of interest and date of conversion is decided at the time of issue.
(3) The interest is paid up to the date of conversion.
(4) On conversion the debenture holders are eligible for dividends and other rights and privileges of shareholders.
(5) A good company's convertible debentures are very popular in the market.