Question:
Explain in detail the types of debenture a company can issue.
Answer:
Different types of debentures that a company can issue are described below:
- Convertible and Non-convertible Debenture: Convertible debentures are those debentures that can be converted into equity shares after the expiry of a specified period. On the other hand, non-convertible debentures are those which cannot be converted into equity shares.
- Registered and Bearer: Registered debentures are those which are duly recorded in the register of debentures holders maintained by the company. These can be transferred only through a regular instrument of transfer. In contrast the debentures which are transferable by more delivery are called bearer debentures.
- Secured and Unsecured: Secured debentures are such which create a charge on the assets of the company, thereby mortgaging the assets of the company. Unsecured debentures on the other hand do not carry any charge or security on the assets of the company.
- First and Second: Debentures that are rapid before other debentures are known as first debentures. The second debentures are those which are paid after the first debentures have been paid back.
Sources of Business Finance
Q 1.
Write a note on international sources of finance.
Q 2.
In leasing agreement what right is given to lessee?
Q 3.
Differentiate between a share and a debenture.
Q 4.
Give the full form of GDR and ADR.
Q 5.
What is a commercial paper? What are its advantages and limitations?
Q 7.
Explain in detail the types of debenture a company can issue.
Q 8.
Name two sources of funds under owner's fund.
Q 9.
Which deposits are directly raised from the public?
Q 10.
Explain trade credit and bank credit as sources of short term finance for business enterprises.
Q 11.
State two factors affecting the working capital requirement of a firm.
Q 12.
What advantage does issue of debentures provide over the issue of equity shares?
Q 13.
What do you mean by discounting of bills of exchange?
Q 14.
Why does business enterprise need finance?
Q 15.
Specify the objective of I.D.B.I.
Q 16.
Preference shares are preferred by company but not by investors. Why?
Q 17.
What is business finance? Why do businesses need funds? Explain.
Q 18.
What is factoring? Discuss its pros and cons.
Q 19.
Who regulates the acceptance of public deposits?
Q 20.
State the meaning of finance. What factors determine working capital and fixed capital requirements of a business?
Q 21.
Name any three special financial institutions and state their objectives.
Q 22.
What is lease financing? Discuss its merits and demerits.
Q 23.
What are Indian depository receipts (IDRs)?
Q 24.
Discuss the financial instruments used in international financing.
Q 25.
Why is equity share capital called Risk Capital'?
Q 26.
Explain different types of preference shares which can be issued by a company.
Q 27.
What are retained profits? Discuss their advantages and disadvantages.
Q 28.
State various sources of short and medium term funds.
Q 29.
Why preferences are given to preferential shares?
Q 30.
Retained earnings are not a good source from the values point of view as it is the right of equity shareholders. Do you agree? Justify your answer.
Q 31.
What are public deposits?
Q 32.
Name zones of the Lessors and Lessees in India.
Q 33.
What is the status of debenture holders?
Q 35.
Describe in brief the features of equity shares.
Q 36.
What preferential rights are enjoyed by preference shareholders? Explain.
Q 37.
What are the two important functions of factors?
Q 38.
Who are called the owners of a company?
Q 39.
What is a trade credit?
Q 40.
State various sources of long term funds.
Q 41.
State two factors affecting the fixed capital requirement of a firm.
Q 42.
What is the difference between GDR and ADR? Explain.
Q 43.
Mr. John has ? 1,00,000 for investment purposes. Should he invest in equity shares, preference shares, public deposits or debentures? Justify your answer.
Q 44.
What are retained earnings?
Q 45.
What are the preferences given to preference shareholders?
Q 46.
As a source of finance retained profit is better than other sources. Do you agree with this view? Give reasons for your answer.
Q 47.
List different types of finance.
Q 48.
Classify internal and external sources on the basis of time.
Q 49.
Preference shares are not suitable for which kind of investors?
Q 50.
List sources of raising long-term and short term finance.
