Question

On 1st April, 2022, Mega Ltd. issued 30,000, 10% Debentures of ₹100 each at a discount of 10%. The total amount of interest due on debentures for the year ending 31st March, 2023 will be:} 
 

• A. ₹2,70,000
• B. ₹3,00,000
• C. ₹27,000
• D. ₹30,000

Hint:

Debenture interest is calculated on the face value, not on the issue price.

Answer 1

The Correct Option is B

Step 1: Calculate the total debenture amount. The face value of each debenture is ₹100, and 30,000 debentures were issued. Therefore: \[ \text{Total face value} = 30,000 \times ₹100 = ₹30,00,000. \] Step 2: Calculate the annual interest. The interest rate is 10%, so the total interest for one year is: \[ \text{Total interest} = 10% \times ₹30,00,000 = ₹3,00,000. \]