The director of Shah Ltd. resolved that 250 equity shares of Rs.100 each be forfeited for non-payment of the second and final call of Rs.30 per share. Out of these, 180 shares were re-issued at Rs.60 per share. The amount to be transferred to capital reserve account will be:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 5,400
When forfeited shares are reissued at a discount, the discount is met out of the amount forfeited on those shares. Whatever is left of the forfeited amount on the reissued shares is a capital profit and goes to Capital Reserve.
Amount forfeited per share = Rs. 100 − Rs. 30 (unpaid final call) = Rs. 70
Forfeited amount on 180 reissued shares = 180 × Rs. 70 = Rs. 12,600
Discount on reissue = 180 × (Rs. 100 − Rs. 60) = 180 × Rs. 40 = Rs. 7,200
Capital Reserve = Rs. 12,600 − Rs. 7,200 = Rs. 5,400
The forfeited amount on the 70 shares not yet reissued (70 × Rs. 70 = Rs. 4,900) stays in Share Forfeiture Account.
Note: NTA picked this question from an NCERT (2026-27) illustration and changed the figures. Do not ignore NCERT while practising numericals.
NCERT (2026-27 edition):
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