Question

Discount allowed on re-issue of forfeited shares is debited to ______.

Options

• Share Capital A/c

• Share Forfeiture A/c

• Statement of Profit & Loss

• General Reserve A/c

Answer 1

Discount allowed on re-issue of forfeited shares is debited to Share Forfeiture A/c.

Explanation:

The sum already received on forfeited shares (included in the Share Forfeiture A/c) is deducted from the discount when those shares are reissued at a reduced price. Consequently, Share Forfeiture A/c is deducted for the reissue discount.