Question

A company AB Ltd issued 12% debentures of ₹ 10,00,000 of ₹ 100 each to public. In the terms of issue, these debentures are redeemable after 10 months ending on 31st January, 2022. These debentures will be shown in balance sheet as on 31st March, 2021 under the heading:

• A. Long-Term Liability
• B. Current Liability
• C. Fixed Assets
• D. Current Assets

Hint:

Always check the "distance" between the Balance Sheet date and the maturity date.
• $> 12$ months = Non-current Liability.
• $\le 12$ months = Current Liability. Even if a debenture was originally issued for 10 years, in its final year, it "moves" into the Current Liability section.

Answer 1

The Correct Option is B