English

Ruby limited invited applications for 1,00,000 shares of ₹10 each at a premium of 30% payable as follows: On Application ₹4 On Allotment ₹5 On First Call ₹2 On Second and Final Call ₹2 - Accounts

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Question

Ruby limited invited applications for 1,00,000 shares of ₹10 each at a premium of 30% payable as follows:

On Application ₹4
On Allotment ₹5
On First Call ₹2
On Second and Final Call ₹2

The public subscribed for two times the shares that were offered by the company. The directors decided to allot the shares to all the applicants on a pro-rata basis. Santosh who had applied for 6,000 shares, did not pay anything after the Application. Her shares were forfeited after the final call. 50% of the forfeited shares were reissued to Ashok as fully paid in such a manner that ₹1,500 were transferred to Capital Reserve A/c.

How many shares were allotted to Santosh?

Options

  • 12,000

  • 6,000

  • 3,000

  • 2,000

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Solution

3,000

Explanation:

Oversubscribed 2 × ⇒ pro-rata ratio 1 : 2

Santosh applied for 6,000

allotted = 6,000 × `(1/2)` = 3,000

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Chapter 6: Company Accounts - Issue of Shares - OBJECTIVE TYPE QUESTIONS [Page 6.225]

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D. K. Goel Accountancy Volume 1 and 2 [English] Class 12 ISC
Chapter 6 Company Accounts - Issue of Shares
OBJECTIVE TYPE QUESTIONS | Q 48. | Page 6.225
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