Question

4,000 shares of ₹ 10 each were forfeited for non-payment of the second and final call money of ₹ 2 per share. The minimum amount that the company must collect at the time of reissue of these shares will be:

Options

• ₹ 8,000

• ₹ 32,000

• ₹ 40,000

• ₹ 48,000

Answer 1

₹ 8,000

Explanation:

A company may reissue forfeited shares at any price; however, the total amount received on reissue must not be less than the amount unpaid on the shares at the time of forfeiture.

∴ Minimum amount to be received on reissue = 4,000 × ₹ 2

= ₹ 8,000