Question :
Y Ltd., purchased plant and machinery for Rs.2,00,000 from Z Ltd. 20% of the amount was paid by Y Ltd. by accepting a bill of exchange in favour of Z Ltd. and the balance was paid by issuing 6% debentures of Rs. 1,000 each at a premium of 25%.
Number of debentures issued is -------
Option 1: 1,280 debentures
Option 2: 128 debentures
Option 3: 160 debentures
Option 4: 1,600 debentures
Correct Answer: 1,280 debentures
Solution : Answer = 1280 debentures
Plant and Machinery A/C Dr 20,00,000
To B/P - 40,000
To Vendor Co- 1,60,000
Vendor Co - Dr 1,60,000
(1280 x 100) To Debentures 1,28,000
To Securities Premium 32,000
($\frac{1,60,000}{125}$ = 1280 Debentures. Hence, the correct option is 1.
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