On 1st April 2023, Veebee Ltd. issued 20,000, 13% debentures of \( ₹ 100 \) each at a discount of 10% redeemable at a premium of 5% after 4 years. Total amount of interest on debentures for the year ending 31st March, 2024 will be :
Show Hint
- \( ₹ 2,00,000 \)
- \( ₹ 2,60,000 \)
- \( ₹ 1,00,000 \)
- \( ₹ 3,00,000 \)
The Correct Option is B
Solution and Explanation
Veebee Ltd. issued 20,000 debentures of \( ₹ 100 \) each. Despite being issued at a discount and redeemable at a premium, the interest is always calculated on the face value. Step 2: Calculate face value and interest.
\[ \text{Face value of debentures} = 20,000 \times 100 = ₹ 20,00,000 \] \[ \text{Interest @ 13%} = 13% \times 20,00,000 = ₹ 2,60,000 \] Since debentures were issued on 1st April 2023, the full year's interest is applicable. Final Answer:\ \( \boxed{₹ 2,60,000} \)
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