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10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ?
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10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if c...
Solution:
Given:
- Face value of debenture (FV) = Rs. 100
- Redemption value of debenture (RV) = FV + 20% of FV = Rs. 120
- Annual interest rate on debenture = 10%
- Number of debentures = 1000
- Face value of preference share (FV) = Rs. 100
- Premium on conversion of debenture into preference share = Rs. 25
- Rate of dividend on preference share = 12%
Calculation of Amount of Debentures:
- Amount of one debenture = FV + Interest = Rs. 100 + Rs. 10 = Rs. 110
- Amount of 1000 debentures = 1000 x Rs. 110 = Rs. 1,10,000
Calculation of Redemption Value of Debentures:
- Redemption value of one debenture = RV = Rs. 120
- Redemption value of 1000 debentures = 1000 x Rs. 120 = Rs. 1,20,000
Calculation of Amount Received on Conversion:
- Amount received on conversion of one debenture into preference share = (FV + Premium) = Rs. 100 + Rs. 25 = Rs. 125
- Amount received on conversion of 1000 debentures = 1000 x Rs. 125 = Rs. 1,25,000
Calculation of Number of Preference Shares:
- Face value of preference share = Rs. 100
- Amount received on conversion of one debenture into preference share = Rs. 125
- Number of preference shares = Amount received on conversion / (FV + Premium) = 1,25,000 / 125 = 1000
Conclusion:
Hence, the number of preference shares will be 1000.
Given:
- Face value of debenture (FV) = Rs. 100
- Redemption value of debenture (RV) = FV + 20% of FV = Rs. 120
- Annual interest rate on debenture = 10%
- Number of debentures = 1000
- Face value of preference share (FV) = Rs. 100
- Premium on conversion of debenture into preference share = Rs. 25
- Rate of dividend on preference share = 12%
Calculation of Amount of Debentures:
- Amount of one debenture = FV + Interest = Rs. 100 + Rs. 10 = Rs. 110
- Amount of 1000 debentures = 1000 x Rs. 110 = Rs. 1,10,000
Calculation of Redemption Value of Debentures:
- Redemption value of one debenture = RV = Rs. 120
- Redemption value of 1000 debentures = 1000 x Rs. 120 = Rs. 1,20,000
Calculation of Amount Received on Conversion:
- Amount received on conversion of one debenture into preference share = (FV + Premium) = Rs. 100 + Rs. 25 = Rs. 125
- Amount received on conversion of 1000 debentures = 1000 x Rs. 125 = Rs. 1,25,000
Calculation of Number of Preference Shares:
- Face value of preference share = Rs. 100
- Amount received on conversion of one debenture into preference share = Rs. 125
- Number of preference shares = Amount received on conversion / (FV + Premium) = 1,25,000 / 125 = 1000
Conclusion:
Hence, the number of preference shares will be 1000.
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10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ?
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10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about 10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for 10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ?.
10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about 10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for 10 % , 1000 debentures of rs. 100 each redeemable at 20 % premium if converted into 12 % preference shares of rs. 100 each at rs. 25 premium what will be the number of preference shares ?.
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