Ravi Ltd. issued 50,000 shares of ₹10 each payable as ₹2 on application, ₹3 on allotment, ₹2.5 on first call, and ₹2.5 on the second and final call. All the amount was duly received except for the second and final call on 800 shares. These shares were forfeited. Out of these, 600 shares were re-issued as fully paid up in such a way that ₹2,100 were transferred to the capital reserve.
Calculate the re-issue price per share:

[2 marks]

₹6

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₹4

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₹2.5

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Solution

The correct option is A ₹6
Share Forfeiture = 800 x ₹7.5 = ₹6,000
For 600 shares = $\frac{₹ 6, 000}{800} \times 600$

= ₹4,500
Discount = ₹4,500 - ₹2,100 = ₹2,400
Discount per share = $\frac{₹ 2, 400}{600}$
= ₹4 per share
Re-issue Price = Nominal Value - Discount
= ₹10 - ₹4 = ₹6

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Similar questions

Q. Ravi Ltd. issued 50,000 shares of ₹10 each payable as ₹2 on application, ₹3 on allotment, ₹2.5 on first call, and ₹2.5 on the second and final call. All the amount was duly received except for the second and final call on 800 shares. These shares were forfeited. Out of these, 600 shares were re-issued as fully paid up in such a way that ₹2,100 were transferred to the capital reserve.
Pass the journal entry for forfeiture of shares:

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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?

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Q. D Ltd. issued 1,00,000 equity shares of Rs 10 each at a premium of Rs. 2 per share. The amount payable was Rs. 2 on application, Rs. 5 on allotment (including premium) & rest on first & final call. Applications were received for 1,20,000 shares. Excess application money was refunded to applications. All monies due were received except the allotment and first & final call monies on 1,000 shares. These shares were forfeited and reissued at Rs 9 per share.
On reissue of forfeited shares, balance of share forfeiture account transferred to capital reserve account will be _____.

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The correct option is A ₹6Share Forfeiture = 800 x ₹7.5 = ₹6,000 For 600 shares = ₹6,000800×600 = ₹4,500 Discount = ₹4,500 - ₹2,100 = ₹2,400 Discount per share = ₹2,400600 = ₹4 per share Re-issue Price = Nominal Value - Discount = ₹10 - ₹4 = ₹6