The Directors of Tivoli Plastics Ltd, resolved that 200 equity shares of ₹100 each be Forfeited for non-payment of the second and final call of ₹30 per share. Out of these, 150 shares were reissued at ₹60 per share as fully paid-up. How much amount will be transferred to Capital Reserve Account?

₹4,500

The correct answer is option 2- ₹4,500.

Journal entry at the time of forfeiture of 200 shares:
Share capital A/c      Dr          ₹20,000 (200 x 100)
    To share forfeiture A/c                    ₹14,000 (200 x 70)
    To share final call A/c                     ₹6,000 (200 x 30)
(Shares forfeited)

Journal entry at the time of reissue of 150 shares:
Bank A/c                     Dr     ₹9,000 (150 x 60)
Share forfeiture A/c      Dr    ₹6,000 (150 x 40)
         To share capital A/c                ₹15,000 (150 x 100)
(Reissue of shares)

Amount Related to 150 shares = 14,000/200 X 150
                                                 = 10,500
Amount used in reissue of shares = 6,000
Amount transferred to capital reserve = 10,500- 6,000
                                                               = ₹4,500