Bajaj Sales Ltd. issues 20,000 equity shares of Rs. 20 each to the public. The amount is payable as,
On application Rs. 4 per share
On allotment Rs. 4 per share
On first call Rs. 6 per share
On final call Rs. 6 per share
All money has been received on shares. Only one shareholder, who has 200 shares could not pay allotment money and his shares have been forfeited before making first call. Forfeited shares have been re-issued at Rs. 18 fully paid-up. What is the amount of capital reserve?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 400
The shares were forfeited before the first call, so only application and allotment (Rs. 4 + Rs. 4 = Rs. 8 per share) had been called up, and the defaulter had paid only the application money.
Amount forfeited = 200 shares × Rs. 4 = Rs. 800
Discount on reissue = 200 shares × (Rs. 20 − Rs. 18) = Rs. 400
Balance in Share Forfeiture A/c on the reissued shares = Rs. 800 − Rs. 400 = Rs. 400
Transferred to Capital Reserve = Rs. 400
NCERT (2026-27 edition):
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