The director of Poly Plastic Limited resolved that 200 equity shares of Rs.100 each be forfeited for non-payment of the second and final call of Rs.30 per share. Out of these, 150 shares were re-issued at Rs.60 per share to Mohit. Profit on reissue of forfeited shares transferred to capital reserve. Amount credited to capital reserve account is-
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Rs. 4500
When forfeited shares are reissued, the forfeited amount on those shares first absorbs the discount allowed on reissue; whatever is left is a capital profit and goes to Capital Reserve. Only the 150 reissued shares count, not all 200.
Amount received per share before forfeiture = Rs. 100 − Rs. 30 (final call unpaid) = Rs. 70
Forfeited amount on 150 reissued shares = 150 × Rs. 70 = Rs. 10,500
Discount on reissue = 150 × (Rs. 100 − Rs. 60) = Rs. 6,000
Transferred to Capital Reserve = 10,500 − 6,000 = Rs. 4,500
The forfeited amount on the other 50 shares (Rs. 3,500) stays in Share Forfeiture Account until those shares too are reissued.
NCERT (2026-27 edition):
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