Question

Divya Ltd. forfeited 7,000 equity shares of ₹ 100 each issued at a premium of 10%, for non-payment of first and final call of ₹ 40 per share. The maximum amount of discount at which these shares can be reissued will be

Options

• ₹ 2,80,000

• ₹ 4,20,000.

• ₹ 4,90,000.

• ₹ 3,50,000.

Answer 1

₹ 4,20,000.

Explanation:

₹ 40 per share was unpaid on a share of ₹ 100, so ₹ 60 per share had been received and forfeited. Maximum discount on reissue cannot exceed the amount forfeited.

7,000 × ₹ 60 = ₹ 4,20,000