The company purchased plant with a book value of ₹1,90,000 from National Victory Company and agreed to pay via issuing 2000, 10% Debentures of ₹100 each at a discount of 5%. Amount that will be credited to 10% Debenture A/c will be:

₹2,00,000

The correct answer is option 2- ₹2,00,000.

Journal entry for the purchase of plant-
Plant A/c         Dr.                   ₹1,90,000
    To National Victory Co.                     ₹1,90,000

Journal entry for the issue of debentures in consideration of purchase of plant-
National Victory Co.     Dr        ₹1,90,000
Discount on issue         Dr       ₹10,000
          To 10% debentures A/c                 ₹2,00,000
(Issue of 2,000 debentures at discount)

Debentures A/c = 2,000 x 100
                         = 2,00,000
Discount = 100 x 5/100
              = 5
Discount amount = 2,000 x 5
                            = 10,000