Question

4,000 shares of ₹ 10 each were forfeited for non-payment of second and final call money of ₹ 2 per share. The minimum amount that the company must collect at the time of reissue of these shares will be :

• A. ₹ 8,000
• B. ₹ 32,000
• C. ₹ 40,000
• D. ₹ 48,000

Hint:

Company cannot reissue shares at a discount more than the forfeited amount. Minimum reissue value = face value – unpaid call.

Answer 1

The Correct Option is B

Face value per share = ₹ 10
Unpaid = ₹ 2 → Amount received before forfeiture = ₹ 8
Minimum reissue price = Face value – Amount unpaid = ₹ 10 – ₹ 2 = ₹ 8 So, minimum amount to collect on reissue = ₹ 8 × 4,000 = ₹ 32,000