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Test your understanding with targeted questions related to the topic.
Question 1
Easy
What is the purpose of Debenture Redemption Reserve (DRR)?
π‘ Hint: Think about why companies need to prepare for repayment.
Question 2
Easy
Define what a debenture is.
π‘ Hint: Consider debentures as similar to bonds.
Practice 4 more questions and get performance evaluation
Engage in quick quizzes to reinforce what you've learned and check your comprehension.
Question 1
What does DRR stand for?
π‘ Hint: Think about the reserve's function.
Question 2
True or False: The premium is an additional charge incurred when redeeming debentures.
π‘ Hint: What happens when you pay more than the face value?
Solve 1 more question and get performance evaluation
Push your limits with challenges.
Question 1
A company redeems βΉ2,00,000 of 10% debentures at a premium of 5%. Prepare the journal entries for the redemption.
π‘ Hint: Identify total amounts and whether to add the premium in your entries.
Question 2
Discuss the potential impact on the companyβs financial health if DRR is not maintained before redemption.
π‘ Hint: Consider what financial stability means for businesses.
Challenge and get performance evaluation