Question :
Nirula's Ltd. has 10,000; 9% Debentures of Rs. 100 each redeemable on 31st March, 2026. The period of Operating Cycle is 24 months. In the Balance Sheet as at 31st March, 2020, such debentures will be shown as----------------- under the head --------------------------
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: Long term borrowing and non-current liabilities
Solution : Answer = Long-term borrowing and non-current liabilities
In the Balance Sheet as of March 31, 2020, Nirula's Ltd. will classify its 9% Debentures due for redemption on March 31, 2026, as "Long-term borrowing" and "Non-current liabilities." This categorization reflects the long-term nature of the debentures and their maturity beyond the company's operating cycle.
Hence, the correct option is 1.
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