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If debenture are of Rs 100000 , Discount on issue 5% , expense in issue Rs 1000, redemable after 10 year, then cost of 12% debenture will be?
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If debenture are of Rs 100000 , Discount on issue 5% , expense in issu...
Cost of 12% Debenture


Information Given


  • Face value of debenture: Rs 100000

  • Discount on issue: 5%

  • Expense in issue: Rs 1000

  • Redeemable after: 10 years



Explanation

The cost of debenture is calculated using the following formula:

Cost of Debenture = (Face Value - Discount) + Expenses

where,

Face Value = Rs 100000

Discount = 5% of Face Value = Rs 5000

Expenses = Rs 1000

Therefore,

Cost of Debenture = (100000 - 5000) + 1000 = Rs 96100


Conclusion

The cost of 12% debenture is calculated to be Rs 96100. It is important to note that the discount on issue and expenses in issue are subtracted from the face value to calculate the cost of debenture.
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If debenture are of Rs 100000 , Discount on issue 5% , expense in issue Rs 1000, redemable after 10 year, then cost of 12% debenture will be?
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If debenture are of Rs 100000 , Discount on issue 5% , expense in issue Rs 1000, redemable after 10 year, then cost of 12% debenture will be? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about If debenture are of Rs 100000 , Discount on issue 5% , expense in issue Rs 1000, redemable after 10 year, then cost of 12% debenture will be? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for If debenture are of Rs 100000 , Discount on issue 5% , expense in issue Rs 1000, redemable after 10 year, then cost of 12% debenture will be?.
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