R.Ltd. offered 20,00,000, 10% Debenture of Rs 200 each at a discount of 7% redeemable at premium of 8% after 9 years. Record necessary entries in the books of R. Ltd.
Answers
Answer:
R.Ltd will receive cash Rs. 37,200,000.
Explanation:
R. Ltd ability to issue 2,000,000 debenture, from which they issue 10 % of 2,000,000. It means they sell 200,000 debenture @ Rs. 200 at discount of 7 % also right now. The actual price of debenture will be Rs.186. So they will cash amount Rs.37,200,000.
R.LTD. will receive cash amount of rs. 3,72,00,000,
Explanation:
R. LTD. is issue 20,00,000,10% debenture of rs 200 each at a 7% discount.
it means R.LTD. is sell 2,00,000, 10% debenture @ 186 each ,
the actual price of 10% debenture is 186 and R.LTD. will receive cash amount rs. 3,72,00,000,
journal entries:
cash a/c DR 3,72,00,000,
discount on issue of debenture DR 28,000,00
TO 10% debenture CR 4,00,00,000,
( Being the 2,00,000, 10% issue of rs. 200 at 7% discount)