BUSINESS ADMINISTRATION
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Long term loan finance
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Interest on debenture is a tax deductible expense for the company
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Fixed and regular source of income to the investor
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None of these
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Detailed explanation-1: -"Debenture are completely unsafe” this statement is false because debenture holders are lenders for the company.
Detailed explanation-2: -A debenture holder receives interest only in the event of profit.
Detailed explanation-3: -Which of the following is false with respect to debentures? a)They can be issued for cashb)They can be issued as collateral securityc)They can be issued in lieu of dividendsd)NoneCorrect answer is option ‘C’.
Detailed explanation-4: -Expert-Verified Answer. The correct answer is OPTION D: Return Debenture.
Detailed explanation-5: -Solutions for Which of the following is not a characteristic of Bearer Debentures? a)They are treated as negotiable instrumentsb)Their transfer requires a deed of transferc)They are transferable by mere deliveryd)The interest on it is paid to the holder irrespective of identity. Correct answer is option ‘B’.