(a) Write a Short Note on "Issue of Debentures as a
Collateral Security".
Answers
Answer:
Debentures issued as collateral security can be transacted in 2 ways in the books of the enterprise:
Explanation:
Collateral Security is a system of subordinate (secondary) protection which is often required by the bank and implied to assure a debtor’s conduct on the debt obligation. The elementary security on the considerable trading loan is normally the part that is being financed, namely: Shipment or a company car, a factory; however, collateral or secondary security might be requested by the bank to help in the process of guarantee so that the loan would be repaid on time. In such situations, the enterprise may circulate its own debentures to the bankers in addition to some other assets guaranteed. Such type of issue of debentures is referred to as ‘Debentures issued as Collateral Security’.
Answer:
Collateral Security is a system of subordinate (secondary) protection which is often required by the bank and implied to assure a debtor’s conduct on the debt obligation. The elementary security on the considerable trading loan is normally the part that is being financed, namely: Shipment or a company car, a factory; however, collateral or secondary security might be requested by the bank to help in the process of guarantee so that the loan would be repaid on time. In such situations, the enterprise may circulate its own debentures to the bankers in addition to some other assets guaranteed. Such type of issue of debentures is referred to as ‘Debentures issued as Collateral Security’.
Explanation:
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