Question

The directors of CAS Ltd. made the final call of Rs 30 per share on May 15 indicating the last date of payment of call money to be May 31. Mr. X, holding 10,000 shares paid the call money on July 15.
If the company adopts Table A, the amount of interest on calls-in-arrear to be paid by
Mr. X is ____________.

• A. Rs 1,250
• B. Rs 1,875
• C. Rs 1,500
• D. Rs 2,250

Answer 1

Answer: (B)

Rs 1,875

Interest on calls-in-arrears is the interest paid by the shareholder to a company when the money on calls or allotment has been paid after the due date.

According to Table A, the interest to be charged on calls-in-arrears is 5%

$Interestoncall-in-arrear=Amountonarrear\times interestrate\times timeperiod$

Substitute the values in above equation

$Interestoncall-in-arrear=3,00,000\times \frac{5}{100}\times \frac{1.5}{12}months=\frac{22,50,000}{1200}=Rs1,875$

Hence the interest charged is Rs $1,875$.