PK Ltd. issued 30,000, 12% Debentures of ₹100 each at 10% premium. Full amount was payable on Application. Public had applied for 40,000 Debentures, pro-rata allotment was made to applicants of 36,000 debentures. Determine the amount to be refunded at the time of allotment of Debentures.
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 11,00,000
30,000 debentures are issued.
Applications received = 40,000
Pro-rata made on 36,000.
4,000 applications rejected.
Amount on rejected applications = 4,000 x (100 + 10 premium)
= ₹4,40,000
On 6,000 applications, pro-rata is made.
Amount refunded on excess application = 6,000 x (100 + 10 premium)
= ₹6,60,000
Total amount refunded = 4,40,000 + 6,60,000
= ₹11,00,000