What will be the interest on debentures for the year ended 31st March 2022, if 800 debentures are issued of ₹100 each at a discount of 5% with an interest rate of 8% at the beginning of the year?
Answer & explanation
Correct answer: option 2
The correct answer is option 2- ₹6,400.
Debentures = 800 X100
= ₹80,000
Interest is paid on nominal value.
Interest = 80,000 X 8/100
= ₹6,400