Wye Ltd. issued 5,000, 10% Debentures of ₹100 each at a discount of 4%, payable ₹40 on application and the balance on allotment. The amount received at the time of allotment call will be -

₹2,80,000

The correct answer is option 1- ₹2,80,000.

Total debentures = 5,000
Face value of debenture = ₹100
Application money = ₹40
Remaining amount = 100 - 40
                              = ₹60

Discount = 100 x 4/100
               = ₹4
Amount per debenture = Remaining amount - discount
                                     = 60 - 4
                                     = ₹56

Allotment money received = 56 x 5,000
                                         = ₹2,80,000