Question

Q. 127. Harish Ltd. forfeited 500 shares of 100 each issued at 40% premium (70
called up) on which application & allotment of 780 each (including premium)
has been received. Out of these, 200 shares were reissued for 365 per share
(570 paid up). What is the amount to be transferred to Capital Reserve?
(A) 15,000
(B) 4,500
(C) 2,000
(D) 7000

Answer 1

Answer:

(a) 15000 is the right answer

Answer 2

Shares forfeited = 500

Re-issued shares = 200

Nominal Value of reissued shares = 200 x 100 = 20,000

Called-up for 200 shares = 200 x 70 = 14,000

Received before forfeiture on 200 shares = 200 x (40 + 40) = 8000 + 8000 = 16,000

Arrears at Rs. 70 called-up = 200 x 30 = 6000

Received for 200 shares on reissue after forfeiture = 200 x 65 = 13,000

Excess received over paid up value of Rs.70 on 200 shares = 200 x (40+65-70) = 7,000  

So the correct answer for the amount to be transferred to Capital Reserve is option (d) Rs.7,000