Payment-in-kind (PIK) bonds are unique debt instruments that allow the issuer to pay interest in the form of additional bonds rather than cash. This is often utilized by companies that want to preserve their cash flow. The face value of the debt increases over time as more bonds are issued to the holder, effectively compounding the interest until the maturity date of the original instrument.

Debenture holders are lenders to the company. They provide long-term debt capital and are entitled to receive fixed interest payments regardless of the company's profit performance. Unlike shareholders, they do not have ownership rights, voting rights, or a claim to dividends, but they have a priority claim on assets in the event of liquidation.

The issue price per debenture is Rs. 100 - 5% = Rs. 95. To find the number of debentures issued, divide the total purchase price by the issue price: 95,000 / 95 = 1,000 debentures.

The par value, also known as the face value or principal amount, is the nominal value assigned to a bond at the time of issuance. It represents the amount of money the issuer agrees to pay back to the bondholder upon the bond's maturity. While the market price of a bond may fluctuate, the par value remains fixed throughout the life of the bond.

When a company deducts tax from interest payments on debentures, it acts as a collector for the tax authorities. This amount represents a liability to the government until it is deposited, and therefore, it must be shown on the liabilities side of the balance sheet until the payment is made.

Public deposits refer to funds accepted by a company directly from the general public. This is a method of raising short-term or medium-term finance. Interested members of the public submit a prescribed application form along with their funds to the company. These deposits are unsecured and are regulated by specific provisions of the Companies Act to protect the interests of the depositors.

Discount on the issue of debentures is a capital loss that is amortized over the life of the debentures. Under traditional accounting practices, the unamortized portion is shown as a fictitious asset on the asset side of the balance sheet until it is fully written off against the securities premium or the statement of profit and loss.

Convertible bonds are hybrid financial instruments that function as debt securities, providing regular interest payments, while offering the holder the right to convert the debt into a predetermined amount of the issuer's equity. This feature provides investors with the potential for capital appreciation if the company's stock price rises, while maintaining the security of a fixed-income investment.

Debentures are debt instruments issued by a company to raise capital from the public. Unlike shares, which represent ownership, debentures represent a loan agreement where the company promises to pay interest to the holder and repay the principal amount at a specified future date.

Callable bonds carry higher reinvestment risk because the issuer has the right to redeem the bond before its scheduled maturity date, usually when market interest rates fall. If the bond is called, the investor receives the principal back earlier than expected and must reinvest those funds in a market where interest rates are lower, thereby reducing their future income stream.