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:- At the time of forfeiture of Ganesh’s share, forfeited share account will be ___________.
Option 1: Credited with Rs. 12,000
Option 2: Credited with Rs. 24,000
Option 3: Credited with Rs. 9,000
Option 4: None of the above
Correct Answer: Credited with Rs. 12,000
Solution : Answer = Credited with Rs. 12,000
Number of Shares allotted to Ganesh = 3,20,000/3,60,000 × 2,700 = 2,400 shares.
Amount received per share = Rs.5.
Amount in Share Forfeiture A/c = Rs.2,400 X 5 = Rs.12,000.
Hence, the correct option is 1.
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