Anthony Ltd. invited applications for 2,00,000 shares of ₹10 each payable ₹3 on application, ₹5 on allotment and balance on call. Public had applied for 3,20,000 shares out of which applications for 70,000 shares were rejected and remaining were allotted on pro-rata basis. Determine the amount to be received by company with allotment, if Mohan holding 10,000 shares paid all his dues along with allotment.
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → ₹8,70,000
Applications accepted = 3,20,000 − 70,000 = 2,50,000 for 2,00,000 shares (pro-rata)
Excess application money = (2,50,000 − 2,00,000) × ₹3 = ₹1,50,000, adjusted towards allotment
Allotment due = 2,00,000 × ₹5 = ₹10,00,000
Cash due on allotment = ₹10,00,000 − ₹1,50,000 = ₹8,50,000
Mohan pays the call in advance = 10,000 × ₹2 = ₹20,000
Amount received with allotment = ₹8,50,000 + ₹20,000 = ₹8,70,000