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CUET Accountancy 2026 PYQs21 May Shift 1. Free, no login required.

Company Accounts

past year questions, CUET Accountancy 2026 21 May Shift 1

Debentures

past year questions, Company Accounts, CUET Accountancy 2026 21 May Shift 1

Easy

common

Following Journal entry is to be passed when interest on debentures become due and tax is deducted at source:

Solution

✅ Correct Option: 4

When interest becomes due the full amount is charged: Debenture Interest A/c is debited. The tax withheld is a liability owed to the government, credited to Income Tax Payable A/c, and only the net sum payable is credited to Debentureholders A/c. Bank is credited later, at the time of actual payment, not when the interest merely falls due.

Related questions:

2025: 24 May Shift 1

Which of the following statements about debentures is FALSE?

(A) Debenture is a part of owned capital.

(B) Debentures cannot be converted into shares.

(C) Redeemable debentures are those debentures, which are payable on the expiry of the specific period.

(D) Debentures cannot be issued at a premium.

Choose the correct answer from the options given below:

2025: 15 May Shift 1

Debenture Application & Allotment A/c Dr. 95,000

Loss on Issue of Debentures A/c Dr. 10,000

To 9% Debenture A/c 1,00,000

To Premium on Redemption of Debentures A/c 5,000

On the basis of the above entry, determine the rate of discount at which Rs. 1,00,000, 9% debentures of Rs. 100 each were issued if they were to be redeemed at a premium of 5%.

2025: 13 May Shift 2

Debentures are issued at a discount. In which of the following the difference between their nominal value and the issue price is treated as the amount of interest.

2026: 21 May Shift 2

The following journal entry appears in the books of X Co. Ltd.

DateParticularL.FDr (₹)Cr (₹)
Bank a/c Dr.4,75,000
Loss on issue of debenture a/c Dr.70,000
To 12% Debentures A/c5,00,000
To Premium on Redemption of Debenture A/c45,000

Debentures issued at discount of ______ and redeemable at a premium of ______.

2026: 21 May Shift 1

"If the company fails to repay the loan along with interest, the lender is free to receive his money from the sale of the primary security and if the realisable value of the primary security falls short to cover the entire amount, the lender has the right to invoke the benefit of additional security whereby debentures may either be presented for redemption or sold in the open market".

Identify the type of issue of debentures stated in the above statement.

2026: 29 May Shift 1

X Ltd. purchased an asset of book value of Rs. 4,00,000 and took over the liability of Rs. 50,000 from Y Ltd. It was agreed that the purchase consideration, settled at Rs. 3,80,000, will be paid by issuing debentures of Rs. 100 each at a discount of 10 % . How many debentures will be issued by X Ltd. to Y Ltd.?

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