Post Utme Skyline University 2021 Accounting Question 6

Practice objective / multiple choice question 6 from the 2021 Post Utme Skyline University Accounting examination.

Post Utme Skyline University 2021 Accounting Objective / Multiple Choice
Question 6 POST_UTME_SKYLINE_UNIVERSITY • 2021 • ACCOUNTING • objective

A company issued 5,000, 10% debentures of ₦100 each at a discount of 5%. The debentures are redeemable at the end of 5 years. Prepare the journal entries for the following transactions: (i) issue of debentures, (ii) interest on debentures for the first year, and (iii) redemption of debentures.

Answer Options

Correct Answer A. Debit Cash ₦450,000; Credit Debentures ₦450,000
B. Debit Debentures ₦450,000; Credit Cash ₦450,000
C. Debit Cash ₦500,000; Credit Debentures ₦500,000
D. Debit Debentures ₦500,000; Credit Cash ₦500,000
Correct Answer
A
Correct Option:
Debit Cash ₦450,000; Credit Debentures ₦450,000

About This Question

This is Post Utme Skyline University 2021 Accounting Question 6. It is one of the objective questions from the 2021 Post Utme Skyline University Accounting examination.

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