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Question
In the event of liquidation of the company, the debentureholders have prior right for ______.
Options
Principal amount.
Interest.
Both principal amount and interest.
None of these.
MCQ
Fill in the Blanks
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Solution
In the event of liquidation of the company, the debentureholders have prior right for both principal amount and interest.
Explanation:
At the time of liquidation, debentureholders have a prior claim for repayment of both the principal amount and outstanding interest before shareholders.
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