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Question
A Company forfeited 1,000 shares of ₹10 each fully paid on which ₹7,000 has been paid. Out of these 800 shares were reissued upon payment of ₹7,600. Amount transferred to Capital Reserve will be ______.
Options
₹6,600
₹9,000
₹5,200
₹7,600
MCQ
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Solution
A Company forfeited 1,000 shares of ₹10 each fully paid on which ₹7,000 has been paid. Out of these 800 shares were reissued upon payment of ₹7,600. Amount transferred to Capital Reserve will be ₹5,200.
Explanation:
Forfeited = 1,000 shares of ₹10 each, fully paid, but only ₹7 paid per share → Forfeiture A/c credited = ₹7,000
Reissue = 800 shares for ₹7,600 (FV = ₹8,000) → Discount = ₹400
Forfeiture related to reissued shares = 800 × 7 = ₹5,600
Capital Reserve = 5,600 − 400
= ₹5,200
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Chapter 6: Company Accounts - Issue of Shares - OBJECTIVE TYPE QUESTIONS [Page 6.209]
