Debentures and Debentures Interest Flashcards
1
Q
What are Debentures?
A
Debentures are long term loans from the public to the company. They are only shown in the Statement of Financial Position as a Non-Current Liability and are a straight lift from the Trial Balance.
2
Q
What are Debentures Interest?
A
Debenture interest is the interest the company must pay the debenture holders each year in return for the loan. It is shown as an expense and any interest that is still owed will be shown as a Current Liability.
