Answer the next 5 Questions from this passage-
High Light India Ltd. invited applications for 30,000 Shares of ₹100 each at a premium of ₹20 per share payable as follows:
On Application ₹40 (including ₹10 premium)
On Allotment ₹30 (including ₹10 premium)
On First Call ₹30
On Second and Final Call ₹20
Applications were received for 40,000 shares and pro-rata allotment was made on the application for 35,000 share. Excess application money was utilised towards allotment.
Rohan to whom 600 shares were allotted failed to pay the allotment money and his shares were forfeited immediately after allotment.
Aman who applied for 1,050 shares failed to pay first call and his shares were forfeited immediately after first Call.
Second and final call was made. All the money due on second call have been received.
Of the shares forfeited, 1,000 shares were reissued as fully paid-up for ₹ 80 per share, which included the whole of Aman's shares.
Allotment money received in advanced alongwith application is.......
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 2,00,000
Applicants for 40,000 shares fall into two groups. Applications for 5,000 shares are rejected and their money refunded; the 35,000 shares group gets 30,000 shares pro-rata, and the extra application money of this group is kept and used against allotment.
Applied in the pro-rata group = 35,000 shares
Allotted = 30,000 shares
Excess shares applied = 5,000
Excess application money = 5,000 × Rs. 40 = Rs. 2,00,000
This Rs. 2,00,000 is credited to Share Allotment Account when the application money is transferred, so it is allotment money received in advance. The other Rs. 2,00,000 on the 5,000 rejected shares is returned through the bank and has nothing to do with allotment.
NCERT (2026-27 edition):
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