Question

When shares are forfeited, the Share Capital A/c is debited with ______ and the Share Forfeiture A/с is credited with ______.

पर्याय

• paid-up capital of shares forfeited; called-up capital of shares forfeited.

• called-up capital of shares forfeited; Calls-in-Arrears of shares forfeited.

• called-up capital of shares forfeited; amount received on shares forfeited.

• Calls-in-Arrears of shares forfeited; amount received on shares forfeited.

Answer 1

When shares are forfeited, the Share Capital A/c is debited with called-up capital of shares forfeited and the Share Forfeiture A/с is credited with amount received on shares forfeited.

Explanation:

On forfeiture, Share Capital A/c is debited with the amount called-up on the forfeited shares. Share Forfeiture A/c is credited with the amount already received on those shares.