ЁЯУв Too many exams? DonтАЩt know which one suits you best? Book Your Free Expert ЁЯСЙ call Now!

    Question

    ABC Ltd had issued 20,000 debentures with FV of Rs.100

    each, redeemable at 5% premium. Debenture holders have an option to convert 20% of redemption value of their holdings into equity shares having face value of 10 issued at a premium of 50%. If, 2500 debenture holder did not avail the conversion option, how many shares would the company have to issue?
    A 36,750 Correct Answer Incorrect Answer
    B 35,000 Correct Answer Incorrect Answer
    C 23,500 Correct Answer Incorrect Answer
    D 24,500 Correct Answer Incorrect Answer
    E 25,500 Correct Answer Incorrect Answer

    Solution

    Debentures converted = 20,000 – 2500 = 17,500 Conversion value = 17500 *105 *20% = 367,500 Value of each share = 10+5% premium = Rs.15 Total number of shares required to be issued = 367500/15 = 24,500 shares

    Practice Next
    More Commercial Laws Questions
    ask-question