Question

M Ltd. forfeited 5,000 equity shares of \rupee 10 each issued at a premium of 10\% for non-payment of final call of \rupee 2 per share. The minimum amount at which these shares can be reissued as fully paid up will be:

• A. \rupee 5,000
• B. \rupee 10,000
• C. \rupee 12,000
• D. \rupee 50,000

Hint:

To reissue forfeited shares, ensure the minimum price covers the unpaid call amount to maintain compliance with share capital rules.

Answer 1

The Correct Option is B

The minimum amount at which the forfeited shares can be reissued as fully paid-up must cover the unpaid amount on the shares. Step 1: Calculate the unpaid amount per share:
Unpaid amount = Final call not paid = \rupee 2 per share.
Step 2: Total unpaid amount for all shares:
\[ \text{Total unpaid amount} = 5,000 \times \rupee 2 = \rupee 10,000 \] The shares can be reissued at a minimum price of \rupee 10,000 to cover the unpaid call amount.