Question

Kewal Ltd. purchased sundry assets from Ganpati Ltd. for rupee 28,60,000. The amount was paid by issuing fully paid shares of rupee 100 each issued at a premium of 10%. The number of shares issued to Ganpati Ltd. were:

• A. 28,000
• B. 31,778
• C. 28,600
• D. 26,000

Hint:

When shares are issued at a premium, the issue price is the sum of the face value and the premium amount.

Answer 1

The Correct Option is D

The total amount paid to Ganpati Ltd. is rupee 28,60,000, and the face value of each share is rupee 100. 

The issue price per share = rupee 100 + 10\% of rupee 100 = rupee 110. \[ \text{Number of shares issued} = \frac{\text{Total Amount}}{\text{Issue Price per Share}} = \frac{rupee 28,60,000}{rupee 110} = 26,000 \text{ shares}. \]