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Forfeiture of Shares-Issued at Premium

Sea Ltd. issu...

Question

Sea Ltd. issued 16,000 equity shares of ₹ 50 each at a premium of ₹ 10 per share payable on application ₹ 15, on allotment ₹ 30 (including premium), and balance on the first and final call. Applications were received for 24,500 shares, and allotment was made on a pro rata basis. Bimal, to whom 3,200 shares were allotted, failed to pay the amount due on the allotment. All his shares were forfeited after the first call was made. The forfeited shares were reissued to Dhriti at par. Calculate the amount received on reissue of forfeited shares.

[0.88 marks]

A

₹80,000

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B

₹1,60,000

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C

₹12,25,000

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D

₹32,000

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Solution

The correct option is B ₹1,60,000
$Amount received on reissue = 3200 \times ₹ 50$
$= ₹ 1, 60, 000$

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