Debenture Interest Characteristics

Steps:

• Identify key features of debenture interest: fixed obligation, paid regardless of profits, charge on assets, tax-deductible.
• Evaluate statements based on accounting standards (e.g., IAS 39 or local GAAP): interest is compulsory and a first charge, not dependent on profits.
• Cross-check choices: select combination matching correct statements (3 and 4).
• Confirm via elimination: incorrect options include wrong statements (1 or 2).

Why D is correct:

• Statements 3 and 4 align with debenture rules—interest is mandatory (per Companies Act) and a fixed charge on assets, not profits.

Why the others are wrong:

• A includes 1 and 2, which misstate interest as profit-dependent.
• B includes 1, incorrectly linking interest to profits only.
• C omits 4, ignoring the asset charge aspect.

Not enough information on exact statements 1–4 to fully verify, but D fits standard debenture principles.

Final answer: D