A company purchased an asset of ₹1,10,000 from Y Ltd. Company and issued 10% Debentures of ₹100 each at 10% Premium to Y Ltd. as purchase consideration. How many debentures company has issued to Y ltd?

1,000 Debentures

The correct answer is option 3- 1,000 Debentures.

Face value of debenture = 100
Premium = 10%
Premium amount = 100 x 10/100
                           = 10
Issue price = Face value + Premium
                  = 100 + 10
                  = 110

No. of Debentures issued = Purchase Consideration/ Issue Price of Debenture
                                         = 1,10,000/ 110
                                         = 1,000 Debentures