Question

Q. 9. A company forfeited 4,000 shares of 10 each on which application money of 3 has been paid. Out of these 2,000 shares were reissued as fully paid up and 4,000 has been transferred to capital reserve. Calculate the rate at which these shares were reissued :
(A) 10 per share
(B) 9 per share
(C) 11 per share
(D) 8 per Share​

Answer 1

Journal Entries

Share capital ac dr 40000

To calls in arrear ac 28000

To share forfeiture ac 12000

Bank ac dr 18000

Share forfeiture ac dr 2000 ... (w.n.1)

To share capital ac 20000

Share forfeiture ac dr 4000

To capital reserve ac 4000

Working note:

• Share forfeited (related to reissue)

=12000×2000/4000 =6000

Now, amount transferred to capitalreserve=4000

Therefore, discount allowed on reissue

=6000-4000=2000

Thus, share reissued at =(20000-2000)/2000=9

Ans: Shares reissued at Rs.9 per share

Answer 2

The answer is b) 9 per share.