Question

At the time of issue of debentures, if amount is received in parts, Debentures Account is ______.

Options

• credited by the amount called as nominal (face) value.

• credited by the issue price of the debentures.

• credited by the nominal (face) value of the debentures.

• None of the above.

Answer 1

At the time of issue of debentures, if amount is received in parts, Debentures Account is credited by the amount called as nominal (face) value.

Explanation:

In corporate accounting, the principal Debentures Account (e.g., "9% Debentures A/c") must strictly reflect the face value of the debentures. When the issue amount is collected in instalments (such as Application, Allotment, and Calls), the Debentures Account is credited at each stage only by the specific portion of the nominal (face) value that is being called up at that time.