Question

Redeemable Preference shares of Rs. $1,00,000$ are redeemed at par for which fresh equity shares of Rs. $80,000$ are issued at discount of $10\%$. The amount transferred to capital Redemption Reserve will be _______.

• A. Rs. $20000$
• B. Rs. $28000$
• C. Rs. $1,00,000$
• D. Rs. $80,000$

Answer 1

The correct option is A Rs. $20000$

b'Equity shares Rs.80,000 at 10% discount [80,000 x 10% = 8,000]

80,000 -8,000 =72,000

Redeemable Preference shares 1,00,000

Less- Equity shares 72,000

28,000.

'