Chapter No 2 - Issue of Debentures Unimax Publications Class 12 Part 2- Solution

The Debenture is treated as the same as a loan. It has a fixed rate of interest which the firm pays after every completed year. The debenture has a fixed maturity date. 

Meaning of Debenture:

The Debenture is the type of loan or debt instrument which is issued in the market to subscribe to the public. It is not taken from any individual institution. It is Issued like equity or preference shares in the market for purchase and sale to the number of subscribers. Like every type of loan, it also has a fixed rate of interest which will be paid by the company to the subscriber of these debentures. The subscriber of the debenture is known as the Debenture holder. 

Definition of Debenture: 

“Debenture includes debentured stock, bonds, and any other instrument of the company evidencing a debt, whether constituting a charge on the assets of the company or not.”

– Section 2(30) of the Companies Act, 2013

“A debenture is a document given by a company as evidence of a debt to the holder usually arising out of a loan and most commonly secured by a charge.”

-Topham

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Chapter No. 2 - Issue of Debentures Unimax Publications Class 12 Part 2- Solution

The question-wise solution to all Questions of Chapter No. 2 - Issue of Debentures Unimax Publications Class 12 Part 2- Solution are shown below: -

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