Read the following information and answer the questions:
On 1st April 2013, a company made an issue of 10,000, 9% debentures of ₹100 each at ₹92 per debenture. The terms of issue provided for redemption of 2,000 debentures every year starting from 31st March 2016, either by conversion into equity shares of ₹20 each or by draw of lot at par at the company's option. On 31st March 2016, the company redeemed 2,000, 9% debentures by converting them into equity shares of ₹20 each.
How much amount of equity shares are issued by the company on conversion?
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → ₹1,84,000
The debentures were issued at ₹92, so the company actually received ₹92 for each debenture. On conversion, equity shares are issued for the amount due to the debentureholders, the net amount originally received.
Amount due = 2,000 debentures × ₹92
= ₹1,84,000 of equity shares
Number of shares = ₹1,84,000 ÷ ₹20 = 9,200 equity shares
NCERT (2026-27 edition):
|
