Calls in Arrears = Unpaid amount on called-up capital.
It is calculated as: Number of shares on which payment is due but not received × Amount per share not paid.
In this case, only the final call of ₹30 was unpaid on 700 shares.
We need to calculate the amount of Calls in Arrears for Diwan Ltd. Step 1: Understand the meaning of Calls in Arrears. Calls in Arrears refers to the amount called up on shares but not yet paid by the shareholders. It represents the unpaid portion of the called-up capital. Step 2: Recall the details from the main question.
Shares issued: 50,000 shares of ₹100 each
Payment schedule:
On Application and Allotment: ₹30 per share
On First call: ₹40 per share
On Second and Final call: Balance (₹100 - ₹30 - ₹40 = ₹30 per share)
Default: Nawal, holding 700 shares, failed to pay the second and final call.
Step 3: Calculate Calls in Arrears.
Only the second and final call of ₹30 per share was not paid by Nawal on his 700 shares.
\[
\text{Calls in Arrears} = 700 \times 30 = ₹ 21,000
\]
All other shareholders paid all amounts due. Therefore, the total calls in arrears is ₹21,000.
Step 4: Analyze each option.
(A) ₹ 21,000: ✓ Correct. This is the unpaid amount on second and final call for 700 shares.
(B) ₹ 70,000: Incorrect. This would be 700 × 100 (full face value) or 700 × 70 (amount paid).
(C) Nil: Incorrect. There is a default.
(D) ₹ 49,000: Incorrect. This is the amount in Share Forfeiture Account (amount already paid by defaulting shareholder).
