200 shares of Rs. 100 each issued at a premium of Rs. 10 were forfeited for the non-payment of allotment money of Rs. 60 (including premium) per share. The first and final call of Rs. 20 per share on these shares were not made. The forfeited shares were reissued at Rs. 70 per share as fully paid-up. Capital reserve created after reissue will be.........
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Zero
Capital reserve on reissue is what is left in Share Forfeiture Account, for the shares reissued, after meeting the discount. So first find how much was actually received (and forfeited) on each share, then compare it with the discount on reissue.
Amount payable per share = Rs. 100 + Rs. 10 premium = Rs. 110
Allotment Rs. 60 (including premium) and first and final call Rs. 20 not received, so application money received = Rs. 110 − Rs. 60 − Rs. 20 = Rs. 30
Called-up capital = Rs. 100 − Rs. 20 (call not made) = Rs. 80; amount forfeited per share = Rs. 30 (premium was not received)
Forfeited on 200 shares = 200 × Rs. 30 = Rs. 6,000
Discount on reissue = Rs. 100 − Rs. 70 = Rs. 30 per share = 200 × Rs. 30 = Rs. 6,000
Capital reserve = Rs. 6,000 − Rs. 6,000 = Zero
NCERT (2026-27 edition):
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