Question

Prayuj ltd. forfeited 2000shares of Rs 10 each,fully called up, on which they had received only Rs 14000.50of forfeited shares were reissued for Rs 9per share fully called up.

Answer 1

each at 11 per share. money was payable as follows: 3 on application, 4 allotment ( including premium) , 4 on first and final call. applications were received for 12000 shares and the directors made pro-rata allotment. mr. ahmad, an applicant for 120 shares, could not pay the allotment and call money and mr. basu, a holder of 200 shares, failed to pay the call. all these shares were forfeited. out of the forfeited shares, 150 shares ( the whole of mr. ahmad's shares

Answer 2

Reissue of Forfeited Shares can be evaluated and identified with money and maximum exchange.

The forfeited shares can be reissued at a discount, but the maximum discount should not exceed the amount available in the share forfeiture account.

When shares are reissued at a loss, then such a loss should be debited to the share forfeiture account.