Question

X Ltd. forfeited 200 shares of Rs. 10 each on
which Rs. 6 per share were paid. The company
reissued 150 shares as fully paid up on a
payment of Rs. 4 per share. What amount will
be transferred to Capital Reserve A/c?​

Answer 1

Explanation:

Here, 200 shares were forfeited of Rs 10 each where Rs 8 was called (i.e. Rs 1600) and Rs 2 was securities premium (i.e. Rs 400) and there was non-payment of first call at Rs 2 per share which makes it Rs 400. The allotment money was  paid at Rs 4 per share i.e. total of Rs 1600 and application money was paid at Rs 2 per share i.e. Rs 400 and first call was paid at Rs 3 per share i.e. Rs 1200. The non paid 150 shares was reissued at Rs 7 each as Rs 8 paid up which make share forfeiture debit to be Re 1 per share. This makes not re-issued forfeited shares to be 50 i.e. Rs 50. Therefore total unpaid shares comp up to Rs 1600- (Rs 400+Rs 50)  i.e. Rs 1250. Hence, the amount in capital reserve account will be Rs 2000- Rs 1250 i.e. Rs 750.