Question

KLB Ltd. forfeited 3,000 shares of ₹ 10 each, ₹ 8 per share called up for non-payment of the first call of ₹ 2 per share. All these shares were reissued at ₹ 7 per share, ₹ 8 paid up. The amount transferred to the Capital Reserve Account will be:
Options:

• A. ₹ 18,000
• B. ₹ 24,000
• C. ₹ 15,000
• D.

Hint:

Forfeited amounts are first used to cover losses on reissued shares. Any remaining balance is transferred to the Capital Reserve Account.

Answer 1

The Correct Option is C

1. Forfeiture Amount for 3,000 Shares: - Amount called up per share = ₹ 8 - Amount unpaid per share = ₹ 2 (First call) - Amount received per share before forfeiture = ₹ 6 (₹ 8 - ₹ 2) - Total amount forfeited: \[ \text{Forfeiture Amount} = 3,000 \times ₹ 6 = ₹ 18,000 \] 2. Reissue of 3,000 Shares: - Reissue price per share = ₹ 7 - Paid-up value per share = ₹ 8 - Amount received on reissue: \[ \text{Reissue Amount} = 3,000 \times ₹ 7 = ₹ 21,000 \] 3. Nominal Value of Reissued Shares: - Nominal value per share = ₹ 8 - Total nominal value: \[ \text{Nominal Value} = 3,000 \times ₹ 8 = ₹ 24,000 \] 4. Utilization of Forfeited Amount: - Amount required to make shares fully paid: \[ \text{Required Amount} = \text{Nominal Value} - \text{Reissue Amount} \] \[ \text{Required Amount} = ₹ 24,000 - ₹ 21,000 = ₹ 3,000 \] 5. Excess Forfeiture Amount Transferred to Capital Reserve: - Total forfeited amount = ₹ 18,000 - Forfeited amount used = ₹ 3,000 - Remaining amount transferred to Capital Reserve: \[ \text{Capital Reserve} = ₹ 18,000 - ₹ 3,000 = ₹ 15,000 \] --- Final Answer: The amount credited to the Capital Reserve Account is \(\mathbf{₹ 15,000}\).