Question

Wellness Co. Ltd. has issued 20,000, 9% Debentures of ₹ 100 each at a premium of 10% on 1st

April, 2018 redeemable as follows:

31st March, 2021 – 10,000 debentures

31st March, 2022 – 4,000 debentures

31st March, 2023 – balance debentures.

It transferred to Debentures Redemption Reserve the required amount as applicable rules of the

Companies Act and Rules, 2014 on due date. How much amount will be transferred to General

Reserve on 31st March, 2021

a) ₹ 1,00,000

b) ₹ 2,50,000

c) ₹ 5,00,000

d) ₹ 20,00,000​

Answer 1

Answer:

Reserve on 31starch 2021 is 2,50,000

Answer 2

The amount transferred to General Reserve on 31 March 2021 is b) Rs. 2,50,000

• According to the Companies Act & Rules 2014. The debenture redemption reserve has certain clauses.
• In the Debenture Redemption Reserve, the required amount transfer is of 25%.  
• Therefore, in 2021 - 10,000 debentures of 100 each will be 100,0000.
• The debenture redemption reserve will be 25% of 100,000, which will be Rs. 2, 50, 000.