X Ltd. purchased assets from Y Ltd. for Rs.98,10,000. X Ltd. issued 12% Debentures of Rs.100 each at 10% discount against the payment. The number of debentures issued to Y Ltd. is:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → 1,09,000
When debentures are issued to a vendor in payment of the purchase consideration, the number of debentures is the purchase consideration divided by the price at which each debenture is issued.
Issue price of one debenture = Rs. 100 − 10% discount = Rs. 90
Number of debentures = Rs. 98,10,000 / Rs. 90 = 1,09,000
The nominal value of the debentures issued is 1,09,000 × Rs. 100 = Rs. 1,09,00,000; the difference of Rs. 10,90,000 is debited to Discount on Issue of Debentures A/c. Dividing by the face value of Rs. 100 would give 98,100, which ignores the discount.
NCERT (2026-27 edition):
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