A company forfeited 2,000 shares of ₹10 each on which ₹7 has been called up and ₹5 has been paid. Out of these 1,500 shares are reissued for ₹9 as fully paid. How much amount is forfeited by the company?
Answer & explanation
Correct answer: option 2
The correct answer is option 2- ₹10,000.
2,000 Shares x 5 = ₹10,000 (Received amount) that will go to share forfeiture account. The journal entry is passed for the forfeiture is as follows-
Share Capital A/c Dr. 14,000 (2,000 x 7)
To Share forfeiture A/c 10,000 (2,000 x 5)
To Share Calls A/c 4,000 ( 2,000 x 2)