Question

Sarita Ltd. forfeited 100 shares of ₹ 10 each, ₹ 8 called up issued at a premium of ₹ 2 per share to Ramesh for nonpayment of allotment money of ₹ 5 per share (including premium). The first and final call of ₹ 2 per share was not made. Out of these 70 shares were reissued to Ashok as ₹ 8 called up for ₹ 10 per share. The gain on reissue will be ______.

विकल्प

• ₹ 500

• ₹ 400

• ₹ 350

• ₹ 300

Answer 1

Sarita Ltd. forfeited 100 shares of ₹ 10 each, ₹ 8 called up issued at a premium of ₹ 2 per share to Ramesh for nonpayment of allotment money of ₹ 5 per share (including premium). The first and final call of ₹ 2 per share was not made. Out of these 70 shares were reissued to Ashok as ₹ 8 called up for ₹ 10 per share. The gain on reissue will be ₹ 350.

Explanation:

Credit balance of share forfeiture = Amount received on forfeiture of shares

= ₹ 5 × 100 (shares)

= ₹ 500

Credit balance of share forfeiture for 70 shares

= `(500 × 70)/100`

= ₹ 350

Discount on reissue of shares = Nil

Gain on reissue = ₹ 350 − Nil

= ₹ 350