Wellness Co. Ltd. (an unlisted company) has issued 20,000, 9% Debentures of ₹ 100 each at a premium of 10% on 1st April, 2018 redeemable as follows: 31st March, 2021 10,000 debentures 31st March, 2022 4,000 debentures 31st March, 2023 balance debentures It transferred the required amount to Debentures Redemption Reserve on due date. How much amount will be transferred to General Reserve on 31st March, 2021

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KollegeApply · Accepted Answer

₹ 1,00,000 Explanation: Total debentures = 20,000 debentures $\times$ ₹ 100 = ₹ 20,00,000 Debentures redeemed on 31st March 2021 = 10,000 debentures $\times$ ₹ 100 = ₹ 10,00,000 DRR requirement (as per SEBI for unlisted companies) = 10% of face value of debentures being redeemed 10% of ₹ 10,00,000 = ₹ 1,00,000 After redemption, the DRR is no longer needed for these debentures and is transferred to General Reserve.

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