Use the following information for questions given ahead:
D Ltd. issued 2,00,000 shares of Rs.100 each at a premium of Rs.20 per share payable as follows:
On application Rs.20; On allotment Rs.50 (including premium); On first call Rs.30; On second and final call Rs.20.
Applications were received for 3,00,000 shares and pro-rata allotment was made to applications of 2,40,000 shares. Money excess received on application was employed on account of sum due on allotment as part of share capital. A, to whom 4,000 shares were allotted, failed to pay the allotment money and on his subsequent failure to pay the first call, his shares were forfeited and B, the holder of 6,000 shares, failed to pay the two calls and his shares were forfeited after the second call. Of the forfeited shares, 8,000 shares were reissued to C at a discount of 10%, the whole of A's forfeited shares being reissued.
Amount refunded to shareholders will be ______________
Use the following information for questions given ahead:
D Ltd. issued 2,00,000 shares of Rs.100 each at a premium of Rs.20 per share payable as follows:
On application Rs.20; On allotment Rs.50 (including premium); On first call Rs.30; On second and final call Rs.20.
Applications were received for 3,00,000 shares and pro-rata allotment was made to applications of 2,40,000 shares. Money excess received on application was employed on account of sum due on allotment as part of share capital. A, to whom 4,000 shares were allotted, failed to pay the allotment money and on his subsequent failure to pay the first call, his shares were forfeited and B, the holder of 6,000 shares, failed to pay the two calls and his shares were forfeited after the second call. Of the forfeited shares, 8,000 shares were reissued to C at a discount of 10%, the whole of A's forfeited shares being reissued.
Amount refunded to shareholders will be ______________
The correct option is C Rs.12,00,000
An oversubscribed security offering often occurs when the interest for an initial public offering (IPO) of securities exceeds the total number of shares issued by the underlying company. Pro rata is the term used to describe a proportionateallocation. It is a method of assigning an amount to a fraction according to its share of the whole. While a pro rata calculation can be used to determine the appropriate portions of any given whole, it is most commonly used in business finance.Therefore, in the given case:
No. of share applied for
(1)
No. of share
Allotted
(2)
Amount received on application
(3)
Amount required on allotment
(4)
Amount adjusted on allotment
(5)
Refund
(3) – (4)
300000
240000
6000000
4800000
Nil
1200000
|
No. of share applied for
(1) |
No. of share Allotted
(2) |
Amount received on application (3) |
Amount required on allotment (4) |
Amount adjusted on allotment (5) |
Refund
(3) – (4) |
|
300000 |
240000 |
6000000 |
4800000 |
Nil |
1200000 |
