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Issue of Debentures as Collateral Security

When debentur...

Question

When debentures are issued as collateral security, no amount is received for debentures.

A

True

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B

False

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Solution

The correct option is A True
When loan is taken from bank or financial Institution, debentures may be issued as collateral security. Any cash is not received against these debenture. On default of repayment of loan, loan may be converted into debentures by bank/financial institution.

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Issue of Debentures as Collateral Security

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