The director of Priya polymer Limited 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 re-issued at ₹60 per share to Monit. The amount of capital reserve will be:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 4,500
Only the forfeited shares that are reissued give a capital profit. The amount forfeited on those shares, less the discount allowed on their reissue, is transferred to Capital Reserve; the balance on the unissued forfeited shares stays in Shares Forfeiture Account.
Amount received per share before forfeiture = Rs. 100 − Rs. 30 = Rs. 70
Forfeited on 150 reissued shares = 150 × Rs. 70 = Rs. 10,500
Discount on reissue = 150 × (Rs. 100 − Rs. 60) = Rs. 6,000
Capital reserve = Rs. 10,500 − Rs. 6,000 = Rs. 4,500
Using all 200 shares (Rs. 14,000 − Rs. 6,000 = Rs. 8,000) is the usual slip: the Rs. 3,500 on the 50 shares not yet reissued is not a profit yet.
NCERT (2026-27 edition):
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