Question : SK Ltd. invited applications for 3,20,000 equity shares of Rs. 10 each at a premium of Rs. 5 per share. The amount was payable as follows:
On application— Rs. 3 per share (including premium Rs. 1 per share),
On allotment— Rs. 5 per share (including premium Rs. 2 per share),
On first and final call—Balance.
Applications for 4,00,000 shares were received. Applications for 40,000 shares were rejected and application money refunded. Shares were allotted on pro rata basis to the remaining applicants. Excess money received with applications was adjusted towards sums due on allotment. Jeevan holding 800 shares failed to pay the allotment money and his shares were immediately forfeited. Afterwards, final call was made. Ganesh who had applied for 2,700 shares failed to pay the final call. His shares were also forfeited. Out of the forfeited shares, 1,500 shares were reissued at Rs. 8 per share fully paid-up. The reissued shares included all the forfeited shares of Jeevan
Question:- What will be the amount of capital Reserve?
Option 1: Rs. 800
Option 2: Rs. 2,400
Option 3: Rs. 3,000
Option 4: Rs. 2,000
Correct Answer: Rs. 2,400
Solution : Answer = Rs. 2,400
Calculation of Amount transferred to Capital Reserve:
Amount forfeited on reissued shares: Jeevan (800 shares) = [Rs. 2,700 - Rs. 800(premium)] = Rs. 1,900
Ganesh (700 shares) = [Rs.12,000 × 700/2,400] =
Rs. 3,500
Total forfeited amount on 1,500 shares = Rs. 5,400
Less: Discount on reissue of 1,500 forfeited shares =
(Rs.3,000)
Amount transferred to Capital Reserve =
Rs.2,400
Hence, the correct option is 2.
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