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प्रश्न
What is meant by the redemption of debentures by conversion?
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उत्तर
When a debenture holder can convert his/her debentures into shares or new debentures after the expiry of a specified period of time, then it is known as the redemption of debentures by conversion. As the company do not need to pay any funds for the redemption, there is no need to maintain the Debenture Redemption Reserve (DRR). The new shares or debentures may be issued at par, premium or at a discount.
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संबंधित प्रश्न
How would you deal with ‘Premium on Redemption of Debentures’?
What is meant by the redemption of debentures by “Purchase in the Open Market”?
Short Answer Question
Under which head is the ‘Debenture Redemption Reserve’ shown in the Balance Sheet?
Differentiate between redemption of debentures out of capital and out of profits.
Can a company purchase its own debentures in the open market? Explain.
What is meant by the conversion of debentures? Describe the method of such a conversion.
A company issued debentures of the face value of Rs 5,00,000 at a discount of 6% on April 01, 2012. These debentures are redeemable by annual drawings of Rs,1,00,000 made on March 31 each year. The directors decided to write off discount based on the debentures outstanding each year.
Calculate the amount of discount to be written-off each year. Give journal entries also.
On 1st April 2015, Mayfair Ltd. issued 4,000 9% debentures of ₹ 100 each at a discount of 5% redeemable at a premium of 8%. The debentures were redeemable on 31st March 2019. The company created the necessary minimum amount of debenture redemption reserve and purchased the required amount of debenture redemption investments as per the provisions of Companies Act, 2013.
Pass the necessary journal entries for the redemption of debentures.
Convertible debentures cannot be issued at a discount if ______.
Profit on cancellation of own debentures is transferred to ______.
Which of the following methods are there for redemption of debentures?
Consider the following statements.
Statement 1 - "No DRR is required for debentures issued by All India Financial Institutions, regulated by RBI and Banking Companies for both public as well as privately placed debentures".
Statement 2 - DRR is required for debentures issued by All India Financial Institutions, regulated by RBI and Banking Companies for both public as well as privately placed debentures"
Give the necessary journal entries at time of redemption of debentures
"X Ltd. issued 500, 9% debentures of Rs.100 each at par and redeemable at par at the end of 5 years out of capital."
Shashi Ltd. decided to redeem its 8,000, 11% Debentures of ₹ 100 each at a premium of 10%. The minimum amount transferred to Debenture Redemption Reserve will be: (assume that the company is not listed)
According to SEBI guidelines, what percentage of the amount of debentures must be transferred to Debenture Redemption Reserve, before the commencement of redemption of debentures, in the case of convertible debentures?
If debentures purchased in the open market are not immediately cancelled, they are treated as:
Which of the following is not true about Debenture Redemption Reserve (DRR)?
What is the nature of Premium on Redemption of Debenture Account?
