Question

Mohan ltd took over asset of 1080000 and liabilities of 80000 of sohan ltd at a value of 960000 payable as 240000 by cheque and the balance by issuing 10% debenture of 100 each of 20% . Calculate the number of debenture to be issued

Answer 1

Explanation:

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Mohan ltd took over asset of 1080000 and liabilities of 80000 of sohan ltd at a value of 960000 payable as 240000 by cheque and the balance by issuing 10% debenture of 100 each of 20% . Calculate the number of debenture to be issued

Answer 2

Lets solve for number of debentures to be issued

Explanation:

Purchase Consideration = Agreed value - Payment by cheque

                                         = 960000 - 240000

                                          = 720000

Issue Price = 100 + ( 20% of 100)

                   = 100 + 20

                    = 120

Number of debentures to be issued = Purchase consideration / Issue Price

                                                            = 720000/ 120

                                                            = 6000

Therefore, Number of debentures to be issued = 6000