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A company issued 1,00,000, 12% debentures of Rs. 100 each. Calculate the amount of interest on debentures.

  • a)
    Rs. 12,000

  • b)
    Rs. 1,20,000

  • c)
    Rs. 12,00,000

  • d)
    None of these

Correct answer is option 'C'. Can you explain this answer?
Verified Answer
A company issued 1,00,000, 12% debentures of Rs. 100 each. Calculate t...
To calculate the amount of interest on the debentures, you can use the following formula:
Interest=Number of Debentures×Face Value of Each Debenture×Interest Rate
Given:
  • Number of Debentures = 1,00,000
  • Face Value of Each Debenture = Rs. 100
  • Interest Rate = 12%
Now, substitute the values into the formula:
Interest=1,00,000×100×12/100
​ Interest=1,00,000×100×0.12=1,20,00,000 (Rs.)
So, the amount of interest on the debentures is Rs. 12,00,000.
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Most Upvoted Answer
A company issued 1,00,000, 12% debentures of Rs. 100 each. Calculate t...
Calculation of Interest on Debentures

Number of Debentures issued = 1,00,000
Face Value of Debentures = Rs. 100
Rate of Interest on Debentures = 12%

Formula to calculate Interest on Debentures:
Interest on Debentures = Number of Debentures × Face Value of Debentures × Rate of Interest

Putting the values in the above formula, we get:
Interest on Debentures = 1,00,000 × 100 × 12/100
Interest on Debentures = 12,00,000

Therefore, the amount of interest on debentures is Rs. 12,00,000. Option (c) is the correct answer.
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A company issued 1,00,000, 12% debentures of Rs. 100 each. Calculate the amount of interest on debentures.a)Rs. 12,000b)Rs. 1,20,000c)Rs. 12,00,000d)None of theseCorrect answer is option 'C'. Can you explain this answer?
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