Question

A Ltd. issued shares of $Rs.10$ each at a discount of $10$%. Mr. B purchased $60$ shares and paid $Rs.2$ on application but did not pay the allotment money of $Rs.3$. If the company forfeited his entire shares, the forfeiture account will be credited by _____________.

• A. $Rs.180$
• B. $Rs.162$
• C. $Rs.120$
• D. $Rs.1.8$

Answer 1

Answer: (C)

$Rs.120$

Share application money of Mr B = 60 shares @ 2 i.e. Rs.120

On non-payment of allotment money , value forfeited will be Rs 120.