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 drawn of lot at par at companies option. On 31st March 2016 Company's 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.
No of debentures = 2,000
Face value = ₹100 each
Discount = 100- 92
= ₹8
Total amount = 2,000 x 92
= ₹1,84,000