Accounting and Finance Basics
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Questions and Answers

What is the value at which forfeited shares are re-issued?

  • Book value
  • Face value
  • Market value (correct)
  • Nominal value
  • What is the term for profit earned by a company before its incorporation?

  • Accumulated profit
  • Pre-operating profit
  • Deferred profit
  • Pre-incorporation profit (correct)
  • What is the process of exchanging debentures for equity shares of the company known as?

  • Amortization
  • Redemption
  • Conversion (correct)
  • Refunding
  • What is the primary purpose of preparing final accounts?

    <p>To assess profitability and financial position</p> Signup and view all the answers

    What is the characteristic of zero-coupon debentures?

    <p>No interest payments</p> Signup and view all the answers

    What financial instrument represents ownership in a company?

    <p>Equity shares</p> Signup and view all the answers

    At what value are forfeited shares typically re-issued?

    <p>Their par value</p> Signup and view all the answers

    What type of profit is earned by a company prior to its incorporation?

    <p>Pre-incorporation profit</p> Signup and view all the answers

    What is the process of exchanging debentures for equity shares known as?

    <p>Conversion</p> Signup and view all the answers

    What type of shareholders are debenture holders considered as?

    <p>Creditors</p> Signup and view all the answers

    Where are the terms and conditions of preference share redemption usually outlined?

    <p>Prospectus</p> Signup and view all the answers

    What part of the balance sheet does shareholders' equity represent?

    <p>Assets - Liabilities</p> Signup and view all the answers

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