[ISC] Q 23 Redemption of Debenture TS Grewal (2024-25)

Solution of question number 23 of Redemption of Debenture Ts Grewal class 12 ISC Board (2024-25)

Vishwas Ltd., an unlisted (Non-NBFC or HFC) company, has ₹ 20,00,000, 9% Debentures of ₹ 100 each of which half the amount is due for redemption at a premium of 10%. The company has in its Debentures Redemption Reserve Account a balance of ₹ 50,000. How much amount of profit should be further transferred to Debentures Redemption Reserve?

Solution:-

Amount of Profit to be transferred to DRR = ₹ 1,50,000 [i.e., (₹ 20,000 ✕ 10/100) – ₹ 50,000].