Moonrise Co. authorised with Share Capital of Rs.5,00,000 issued 10,000 equity shares of Rs.12 each.
Money was payable as
Rs.4 on Application
Rs.4 on Allotment (including premium)
Rs.4 on 1st and final call.
Applications were received for 12,000 shares and the directors decided to make pro-rata allotment. Mr. Rashidi an applicant for 120 shares, could not pay allotment and call money and Mr. Shantanu a holder of 200 shares failed to pay the call. All these shares were forfeited. Out of these forfeited shares, 150 shares (whole of Rashidi) were issued at Rs.8 per share answer following questions on the basis of above, answer from question.
The shares are reissued at
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → discount of Rs.2 per share
The face value of each share is Rs. 10 (the issue price of Rs. 12 includes a premium of Rs. 2). The forfeited shares are reissued at Rs. 8, which is below the face value.
Discount on reissue = Face value − Reissue price = Rs. 10 − Rs. 8 = Rs. 2 per share
Measuring from the issue price of Rs. 12 would give Rs. 4, but a discount on reissue is always measured from the face value, since the premium is not share capital.
NCERT (2026-27 edition):
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