Read the following passage and answer the question.

EFG Ltd. invited applications for 10,000 shares of ₹100 each at a premium of 10 each which is payable as follows-
Application - ₹50
Allotment - ₹35 including premium
Call - ₹25
Applications for 15,000 shares is received by the company. The company rejected the applications for 2,500 shares and made pro-rata on the remaining applicants. Mr. A shareholder who is allotted 400 shares failed to pay the allotment and call money due to which the company forfeited his shares and reissued at ₹105 per share.

How much amount is transferred to capital reserve?

₹25,000

The correct answer is option 2- ₹25,000.

Journal entry for the forfeiture-
Share Capital A/c    Dr. ₹40,000 (400 x 100 Calledup amount)
Securities premium reserve Dr. ₹4,000 (400 x 10 premium amount)
    To share allotment                     ₹9,000  (Not received on allotment, NOTE 1)
    To share first and final call         ₹10,000 ( 400 x 25 not received on call)
    To share forfeiture                     ₹25,000 (Amount received)
(400 shares are forfeited)

* As shares are reissued at premium so whole amount of share forfeiture will be transferred to capital reserve. So, the amount transferred to capital reserve is 25,000.

NOTE 1-

Who allotted 10,000 shares applied for 12,500 shares
Shares allotted to A = 400
Shares applied by A = 12500/10000 x 400
                                = 500
Money received on application by A = 500 x 50
                                                        = ₹25,000
Excess money received by A on application = 100 x 50
                                                                    = 5000
Money due on allotment by A = 400 shares x 35
                                               = 14,000
Excess money adjusted to allotment = 5,000
Money not received by A on allotment = 14,000 - 5,000
                                                            = ₹9,000