Rekha, a shareholder holding 500 shares of Rs. 10 each, did not pay the allotment money of Rs. 4 per share (including a premium of Rs. 2) and the first and final call of Rs. 3. Her shares were forfeited after the first and final call. What will be the amount to be shown under Share Forfeiture Account ?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Rs. 2,500
On forfeiture, Share Forfeiture Account is credited with the amount actually received on the forfeited shares towards share capital. Rekha paid only the application money, so that is the amount forfeited.
Total payable per share = Rs. 10 + premium Rs. 2 = Rs. 12
Allotment (including premium) = Rs. 4; first and final call = Rs. 3
Application money = Rs. 12 − Rs. 4 − Rs. 3 = Rs. 5 per share
Amount received = 500 shares × Rs. 5 = Rs. 2,500
The premium of Rs. 2 was never received, so the Securities Premium Account credited at allotment is debited back (Rs. 1,000); it does not reach the Share Forfeiture Account.
The book’s shareholder is Sunena instead of Rekha; the figures and the answer, Rs. 2,500 in Share Forfeiture Account, are the same. The book’s entry prints “Share Capital Reserve A/c” on the first line; that is a slip for Share Capital A/c (500 shares × Rs. 10 = Rs. 5,000).
Note: This question is from NCERT (2026-27). NTA sets numerical questions from NCERT too, so do not ignore NCERT while practising numericals.
NCERT (2026-27 edition):
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