Question :
If 10,000, 9% Debentures of Rs. 100 each are issued on 1st April, 2019 redeemable on 31st January, 2021. These debentures will be shown as ------------- under the head ---------- in the Balance Sheet as at 31st March, 2020.
Option 1:
Long term borrowing and non-current liabilities
Option 2: Short term borrowing and current liabilities
Option 3: Trade payable
Option 4: None of the above
Correct Answer: Short term borrowing and current liabilities
Solution : Answer = Short-term borrowing and current liabilities
The 9% Debentures issued on April 1, 2019, and redeemable on January 31, 2021, will be classified as short-term borrowings and current liabilities in the Balance Sheet as of March 31, 2020. This classification reflects their status as debts due for repayment within one year, aligning with current liabilities.
Hence, the correct option is 2.
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