Question

Arnav Ltd. purchased assets worth \rupee24,00,000. It issued 9\% debentures of \rupee100 each at a discount of 4\% for payment of the purchase consideration. The number of debentures issued to the vendor were:

• A. 24,000
• B. 25,000
• C. 30,000
• D. 28,000

Hint:

To calculate the number of debentures issued, divide the total consideration by the issue price of a single debenture.

Answer 1

The Correct Option is B

The issue price per debenture is \rupee100 less a 4\% discount: \[ \text{Issue price per debenture} = \rupee100 - \rupee4 = \rupee96. \] The total amount of purchase consideration is \rupee24,00,000. The number of debentures required to settle this amount: \[ \text{Number of debentures} = \frac{\text{Purchase consideration}}{\text{Issue price per debenture}} = \frac{\rupee24,00,000}{\rupee96} = 25,000. \] Thus, 25,000 debentures were issued to the vendor.