True or false about debentures

Exercise and reference answers

Questions

1. Statement is true

   Yes

   Statement

   A debenture is part of borrowed capital.

2. Statement is true

   No

   Statement

   Debentures are usually unsecured in practice.

3. Statement is true

   Yes

   Statement

   Redeemable debentures are repaid after a set period.

4. Statement is true

   Yes

   Statement

   Irredeemable debentures are also called perpetual.

5. Statement is true

   No

   Statement

   Shares carry a charge on company assets.

Instructions

Decide whether each statement is true or false.

Explanation