Ashish Ltd. issued 170 debentures of Rs. 100 each to a creditor who has supplied machinery costing Rs. 16,000. Which of the following is correct?

None of these

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Debentures are issued at premium of Rs 1000

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Debentures are issued at discount of Rs 1000

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Debentures are issued at par

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Solution

The correct option is C
Debentures are issued at discount of Rs 1000

Debentures are issued at discount of Rs 1,000 is correct.

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Similar questions

XYZ Ltd has issued 20,000 debentures at Rs.100 each. But the public have only subscribed to 16,000 debentures. This is the case of ___________.

X.Ltd. issued 15,000, 10% debentures of Rs 100 each. Give journal entries and the Balance Sheet in each of the following cases:

(i) The debentures are issued at a premium of 10%;

(ii) The debentures are issued at a discount of 5%;

(iii) The debentures are issued as a collateral security to bank against a loan of Rs 12,00,000; and

(iv) The debentures are issued to a supplier of machinery costing Rs 13,50,000.

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