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:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → ₹2,00,000
The Debentures Account is always credited with the face (nominal) value of the debentures issued, whatever the issue price. The discount is debited to a separate Discount on Issue of Debentures Account.
Face value = 2,000 × ₹100 = ₹2,00,000
Issue price = ₹100 − 5% = ₹95, so the vendor receives 2,000 × ₹95 = ₹1,90,000
Discount on issue = 2,000 × ₹5 = ₹10,000
Credited to 10% Debentures A/c = ₹2,00,000
NCERT (2026-27 edition):
|
