D and M Ltd. forfeited 5,000 shares of ₹10 each for non-payment of final call of ₹3/- per share. Out of these 2,000 shares were reissued @ ₹12/- per share as fully paid up. What is the maximum discount that can be allowed for re-issue of remaining 3,000 shares?

₹21,000

The correct answer is Option (3) → ₹21,000

On forfeiture of shares = 5,000 x 7 = 35,000 is received. This amount is forfeited by the company.

Journal entry on forfeiture is as follows-
Share Capital A/c Dr.    50,000 (5,000 x 10) called up amount
   To share forfeiture A/c      35,000 (5,000 x 7) received amount
   To share final call A/c       15,000 (5,000 x 3) Not received amount

₹35,000 is related to 5,000 shares. 2,000 shares are already reissued at premium so the amount which is available for discount on 3,000 shares is-
5,000 shares = 35,000
3,000 shares = 35,000/5,000 x 3,000
                    = ₹21,000