Question

Super Seal Ltd. issued 1,00,000 equity shares of ₹ 10 each at a premium of ₹ 2 per share. Harleen, who was allotted 2,000 shares did not pay first and final call of ₹ 5 per share. On forfeiture of Harleen's shares, Securities Premium Account will be debited by

Options

• ₹ 5,000.

• ₹ 10,000.

• ₹ 15,000.

• ₹ Nil.

Answer 1

₹ Nil.

Explanation:

Securities Premium Account is debited on forfeiture only when the premium has not been received. Here, Harleen failed to pay only the first and final call of ₹ 5 per share. Therefore, Securities Premium Account will not be debited.