Ravi Ltd., forfeited 800 shares of Rs. 10 each, Rs. 7.50 paid, for non-payment of Final call of Rs. 2.50 per share. Out of these, 600 shares were re-issued at Rs. 6 per share as fully paid up. Calculate the amount to be transferred to Capital Reserve?

Rs. 2,400

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Rs. 1,300

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Rs. 2,100

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Rs. 700

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Solution

The correct option is C
Rs. 2,100

Profit on 800 shares = 800Rs. 7.5 = Rs. 6,000

So, profit on 600 shares = (6,000/800) 600 = Rs 4,500

Loss on Re-issue = 600(Rs. 10-Rs. 6)= 6004 = Rs. 2,400

Amount transferred to Capital Reserve = Rs 4,500-Rs. 2,400 = Rs 2,100

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Similar questions

(a) Ravi Ltd. forfeited 800 shares of Rs 10 each, Rs 7.50 paid, for non-payment of Final Call of Rs 2.50 per share. Out of these, 600 shares were re-issued as fully paid up in such a way that Rs 2,100 were transferred to capital reserve. Pass necessary journal entries.

(b) X Ltd. forfeited 800 shares of Rs 10 each, Rs 7.50 called-up, for non-payment of Final Call of Rs 2.50 per share. Out of these, 600 shares were re-issued for Rs 6 per share as Rs 7.50 paid up. Pass necessary journal entries.

(c) 400 shares of Rs 10, on which Rs 8 has been called and Rs 6 has been paid, are forfeited. Out of these, 300 are re-issued for Rs 7 as fully paid. Pass necessary journal entries.

Q. Shobhana Ltd. forfeited

30

shares of

R s .10

each fully called up for non-payment of allotment money of

R s .3

per share and call money of

R s .4

per share. These shares are re-issued for

R s .8

per share fully paid. What is the amount to be transferred to Capital Reserve Account?

Pass journal entries for the forfeiture and re-issue in the following cases:

(i) A Ltd. forfeited 400 shares of Anil of Rs 10 each fully called up for non-payment of final call of Rs 2 per share and re-issued to Sunil as fully paid for Rs 10 per share.

(ii) B Ltd. forfeited 500 shares of Rs 10 each fully called up for non-payment of first call of Rs 2 per share and final call of Rs 2 per share. All of these shares were re-issued as fully paid for Rs 8 per share.

(iii) C Ltd.forfeited 600 shares of Rs 10 each fully called up for non-payment of allotment money of Rs 3 per share,first call of Rs 2 share and final call Rs 2 per share. 400 of these shares were re-issued as fully paid up at the maximum rate of discount allowed by law.

(iv) D Ltd. forfeited 800 shares of Rs 10 each fully called up, on which the holder had paid only the application money of Rs 3 per share. Out of these, 500 shares were re-issued at Rs 11 per share, fully paid up.

Give Journal entries for forfeiture and re-issue of shares:

(i) A Ltd. forfeited 1,000 shares of Rs 10 each, Rs 7 called up, issued at a premium of 20% (to be paid at the time of allotment) for non-payment of a first call of Rs 2 per share. Out of these, 600 shares were re-issued as Rs 7 paid up for Rs 4 per share.

(ii) B Ltd. forfeited 1,000 shares of Rs 10 each, Rs 7 called up, issued at a premium of 20% (to be paid at the time of allotment) for non-payment of allotment money of Rs 4 per share (including premium) and first call of Rs 2 per share. Out of these, 600 shares were re-issued as fully paid in such a way that Rs 900 were transferred to capital reserve.

Q. The directors of M Ltd, resolved that 2,000 equity shares of Rs 10 each Rs 7.50 paid be forfeited for non-payment of final call of Rs 2.50. 1,800 of these shares were re-issued as fully paid for Rs 6 per share. The Profit on re-issue is __________.

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Ravi Ltd., forfeited 800 shares of Rs. 10 each, Rs. 7.50 paid, for non-payment of Final call of Rs. 2.50 per share. Out of these, 600 shares were re-issued at Rs. 6 per share as fully paid up. Calculate the amount to be transferred to Capital Reserve?

The correct option is C Rs. 2,100 Profit on 800 shares = 800*Rs. 7.5 = Rs. 6,000 So, profit on 600 shares = (6,000/800) * 600 = Rs 4,500 Loss on Re-issue = 600*(Rs. 10-Rs. 6)= 600*4 = Rs. 2,400 Amount transferred to Capital Reserve = Rs 4,500-Rs. 2,400 = Rs 2,100

The correct option is C
Rs. 2,100

Profit on 800 shares = 800Rs. 7.5 = Rs. 6,000

So, profit on 600 shares = (6,000/800) 600 = Rs 4,500

Loss on Re-issue = 600(Rs. 10-Rs. 6)= 6004 = Rs. 2,400

Amount transferred to Capital Reserve = Rs 4,500-Rs. 2,400 = Rs 2,100