Question

Hero Ltd. purchased building for ₹ 8,10,000. It was agreed that the purchase consideration be paid by issue of 10% Debentures of ₹ 100 each at a discount of 10%. The 10% Debentures Account will be credited with

Options

• ₹ 9,00,000

• ₹ 8,10,000

• ₹ 8,91,000

• ₹ 9,90,000

Answer 1

₹ 9,00,000

Explanation:

Debentures of ₹ 100 are issued at 10% discount, so issue price = ₹ 90.
Face value of debentures = ₹ 8,10,000 × `100/90` = ₹ 9,00,000.