A company purchased assets of the book value of Rs 10,00,000 from Best Ltd. It was agreed that the purchase consideration would be paid by issuing 13% Fully paid Debentures of Rs 40 each. If Debentures are issued at par then how many such Debentures would be issued by the company to Best Ltd.?

None of these

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50,000

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25,000

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1,00,000

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Solution

The correct option is C
25,000

Number of Debenture issued = $\frac{10, 00, 000}{40}$

Number of Debenture issued = 25,000

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Similar questions

A company purchased assets of the book value of Rs 99,000 from another Co. It was agreed that the purchase consideration be paid by issuing $11 %$ Debentures of Rs 100 each. Assume that the debentures have been issued (i) at par, (ii) at a discount of $10 %$ , and (iii) at a premium of $10 %$ .

Give necessary journal entries in the books of purchasing company.

B Ltd purchased assets of the book value of Rs.4,00,000 and took over the liability of Rs. 50,000 from Mohan Bros. It was agreed that the purchase consideration, settled at Rs.3,80,000, be paid by issuing debentures of Rs.100 each

What Journal entries will be made in the following three cases, if debentures are issued

(a) at par

(b) at discount

Exercise

Amar Ltd. purchased assets of the book value of Rs 99,000 from Abhi Ltd. It was agreed that purchase consideration to be paid by issuing 11% Debentures of Rs 100 each Assume debentures have been issued.

1. At par

2. At Discount of 10% and

3. At Premium of 10%

Record necessary journal entries

Q. N Ltd. purchased fixed asset of Rs. 28,80,000. The consideration was paid by issue of 12% Debenture of 100 each at 20% premium. Number of debentures to be issued will be _______.

Q. Exe Ltd. purchased the assets of the book value ₹4,00,000 and took over the liabilities of ₹ 50,000 from Mohan Bros.It was agreed that the purchase consideration ,settled at ₹3,80,000 be paid by issuing debentures of ₹ 100 each.
Pass journal entries if debenture are issued:
(a) at par
(b) at a discount of 10% and
(c) at a premium of 10%.
It was agreed that any fraction of debentures be paid in cash.

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A company purchased assets of the book value of Rs 10,00,000 from Best Ltd. It was agreed that the purchase consideration would be paid by issuing 13% Fully paid Debentures of Rs 40 each. If Debentures are issued at par then how many such Debentures would be issued by the company to Best Ltd.?

The correct option is C 25,000 Number of Debenture issued = 10,00,00040 Number of Debenture issued = 25,000

The correct option is C
25,000

Number of Debenture issued = $\frac{10, 00, 000}{40}$

Number of Debenture issued = 25,000