Question

Mr. Rajesh Kalita invested Rs.120, 000 for buying 1000 BNB shares which were sold at a
premium of 20%. What is the face value of the share?​

Answer 1

ANSWER

Equity share capital A/c Dr(400*100) 40,000

To Share forfeiture account (400*75) 30,000

To calls in arrear account (400*25) 10,000

(Being share forfeited)

Bank A/c Dr.(300*80) 24,000

Share Forfeiture A/c Dr 6000

To Share capital A/c 30,000

(Being shares forfeited re-issued)

Shares forfeiture A/c Dr (30,000-6000) 16,500

To Capital Reserve A/c 16,500

(Being balance in share forfeiture account transferred to capital reserve

Answer 2

Concept: Shares are the units of ownership of the company. Types of shares are equity shares and preference shares.

Given: Mr. Rajesh Kalita invested Rs.120, 000 for buying 1000 BNB shares

Find: Calculate the face value of the share?

Solution: Let the face value of the share is Rs.x

         Amount per share=$\frac{Total amount }{No. of shares}$

                                       =$\frac{1,20.000}{1000}$

                                       =Rs. 120.

          A.T.Q.

$x+\frac{20x}{100} =120$

120x=120×100

$x=\frac{12,000}{120}$

x=Rs. 100.

Final answer: The face value of the share is Rs.100.

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