PK Ltd. issued 30,000, 12% Debentures of Rs. 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.

Rs. 11,00,000

The correct answer is Option (2) → Rs. 11,00,000

30000 debentures are issued.
Applications received = 40000
Pro-rata made on 36000.
4000 applications rejected.
Amount on rejected applications = 4000 x (100 + 10 premium)
                                               = ₹440000

On 6000 applications, pro-rata is made.
Amount refunded on excess application = 6000 x (100 + 10 premium)
                                                         = ₹660000

Total amount refunded = 440000 + 660000
                                 = ₹1100000