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Question
Balance of share forfeiture account is shown in the balance sheet under the head ______.
Options
Share Capital Account
Reserve and Surplus
Current Liabilities and Provisions
Unsecured Loans
MCQ
Fill in the Blanks
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Solution
Balance of share forfeiture account is shown in the balance sheet under the head Reserve and Surplus.
Explanation:
The balance in the Share Forfeiture Account represents the amount already received on forfeited shares.
Since it is a capital profit, it is shown in the Balance Sheet under the head “Reserve and Surplus” until the shares are reissued.
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Chapter 6: Company Accounts - Issue of Shares - OBJECTIVE TYPE QUESTIONS [Page 6.205]
