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 will be -
Answer & explanation
Correct answer: option 1
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