Question

X Ltd. purchased an automatic bottling machine from a vendor for $Rs.165,000$. The company allotted him equity shares at a premium of $10$% instead of paying him in cash. How many equity shares will be allotted to the vendor if the company allotted the shares at $10$% discount?

• A. $18,333$
• B. $17,655.76$
• C. $17,650$
• D. $18,180$

Answer 1

The correct option is A $18,333$

Value of asset purchased=Rs1,65,000

The shares are to be issued at discount of 10%

therefore , issue price of a share=Rs10-10%

=Rs9/share.

No of shares to be issued =Rs1,65,000/Rs9

=18,333 shares.