A shareholder holding 600 shares paid the amount of call @ ₹5 per share on 1st November 2018 whereas the call was due on 1st March 2019. Interest on calls in advance as per Table F will be :
Answer & explanation
Correct answer: option 1
The correct answer is option 1- ₹120.
Table F of the Companies Act provides for the payment of Interest on calls in advance @ 12%. Therefore, the interest on calls in advance will be-
Total amount paid = 600 x 5
= 3,000
Interest will be calculated from 1st Nov to 1st March i.e. 4 months.
Interest = 3,000 x 4/12 x 12/100
= 120
Thus, interest is ₹120.