Question

Following is the extract of the Balance Sheet of Vikalp Ltd. as per Schedule-III, Part-I of Companies Act as at 31st March, 2024 along with Notes to accounts: \vspace{0.3cm} \includegraphics[scale=1.0]{3.png} Answer the following questions: \vspace{0.3cm} (i) The total face value of equity shares issued during the year 2023-2024 was:

Hint:

When analysing share capital notes: - Compare Issued/Subscribed figures year-on-year to find new issues. - 'Subscribed but not fully paid' section reveals shares with potential arrears. Arrears amount / No. of shares gives arrears per share. - Forfeiture: Cap Dr with Called-up; Forfeiture Cr with Amount Received. - Reissue: Calculate discount (Paid-up - Reissue Price). Max Discount = Forfeited Amount. Gain = Forfeited - Discount. Transfer total gain on reissued shares to Capital Reserve.

Answer 1

Issued Capital (Face Value) in 2024 = 6,00,000 shares \(\times\) Rs 10 = Rs 60,00,000.
Issued Capital (Face Value) in 2023 = 5,00,000 shares \(\times\) Rs 10 = Rs 50,00,000.
Increase in Issued Capital (Face Value) during 2023-24 = 60,00,000 - 50,00,000 = Rs 10,00,000.
\vspace{0.3cm} (ii) The number of shares on which the called up amount was not received were:
% Option (A) 1,00,000
(B) 80,000
(C) 3,00,000
(D) 20,000
% Correct Answer Correct Answer:} (D) 20,000
% Solution Solution:
The Note to Accounts for 2024 explicitly shows "Subscribed but not fully paid up: 20,000 equity shares..." and "Less: calls in arrears 40,000". This directly indicates that calls were not received on 20,000 shares.
\vspace{0.3cm} (iii) On 1st April, 2024 Vikalp Limited forfeited all the shares on which the called up amount was not received. On forfeiture, 'Share Capital Account' will be debited by:
% Option (A) Rs 1,60,000
(B) Rs 40,000
(C) Rs 2,00,000
(D) Rs 2,40,000
% Correct Answer Correct Answer:} (C) Rs 2,00,000
% Solution Solution:
Share Capital A/c is debited with the amount called-up on the forfeited shares. The shares forfeited are the 20,000 shares with arrears. The Note for 2024 states these 20,000 shares were "fully called up".
Called-up amount per share = Rs 10 (face value).
Amount debited to Share Capital A/c = 20,000 shares \(\times\) Rs 10 = Rs 2,00,000.
\vspace{0.3cm} (iv) On forfeiture, 'Share Forfeiture Account' will be credited with:
% Option (A) Rs 1,60,000
(B) Rs 40,000
(C) Rs 2,00,000
(D) Rs 2,40,000
% Correct Answer Correct Answer:} (A) Rs 1,60,000
% Solution Solution:
Share Forfeiture A/c is credited with the amount already received on the forfeited shares towards face value.
Total amount called-up on 20,000 shares = Rs 2,00,000 (from iii).
Amount unpaid (Calls in Arrears) on these shares = Rs 40,000 (from Note 2024).
Amount received = Called-up Amount - Unpaid Amount = 2,00,000 - 40,000 = Rs 1,60,000.
\vspace{0.3cm} (v) If all the forfeited shares are reissued at Rs 8 per share fully paid up, the amount credited to 'Capital Reserve A/c' will be:
% Option (A) Rs 40,000
(B) Rs 1,60,000
(C) Rs 2,00,000
(D) Rs 1,20,000
% Correct Answer Correct Answer:} (D) Rs 1,20,000
% Solution Solution:
Amount forfeited per share = Total Amount Forfeited / No. of Shares Forfeited = 1,60,000 / 20,000 = Rs 8.
Shares reissued as fully paid up (Rs 10) for Rs 8 per share.
Discount on reissue per share = Paid-up Value - Reissue Price = Rs 10 - Rs 8 = Rs 2.
Gain on reissue per share = Amount Forfeited per share - Discount on reissue per share = Rs 8 - Rs 2 = Rs 6.
Total amount credited to Capital Reserve = Gain per share \( \times \) No. of shares reissued = Rs 6 \( \times \) 20,000 = Rs 1,20,000.
\vspace{0.3cm} (vi) If the forfeited shares are reissued at the minimum permissible price, the amount credited to 'Capital Reserve Account' will be:
% Option (A) Rs 2,00,000
(B) Rs 1,60,000
(C) Rs 40,000
(D) NIL
% Correct Answer Correct Answer:} (D) NIL
% Solution Solution:
Minimum reissue price (for fully paid shares) = Face Value - Maximum allowable discount.
Maximum allowable discount = Amount forfeited per share = Rs 8 (from v).
Minimum Reissue Price = Rs 10 - Rs 8 = Rs 2 per share.
If reissued at minimum price (Rs 2), the discount on reissue is Rs 8 per share.
Gain on reissue per share = Amount Forfeited per share - Discount on reissue per share = Rs 8 - Rs 8 = Rs 0.
Total amount credited to Capital Reserve = Gain per share \( \times \) No. of shares reissued = Rs 0 \( \times \) 20,000 = Rs 0 (NIL).
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