Question

X Ltd., a listed company, proposed to issue 2,00,000 equity shares of Rs 10 each at par by way of private placement. The maximum amount of brokerage that can be paid by the company = ?

• A. Rs.5,000
• B. Rs.10,000
• C. Rs.20,000
• D. Rs.25,000

Answer 1

The correct option is B Rs.10,000

Brokerage is the commission paid to the outsiders while trading the equity shares. As per National Stock Exchange (NSE), the brokerage paid up to Rs $2,50,000$ is $5$%.

$BrokeragePaid=\frac{5}{100}\times 2,00,000=Rs10,000$

Hence, X Ltd. has to pay Rs $10,000$ as the brokerage amount.