Amount of discount allowed on the reissue of forfeited shares cannot exceed the amount that has:- Option 1: not been called-up on forfeited shares at the time of initial issue. Option 2: been called-up on forfeited shares at the time of initial issue. Option 3: not been received on forfeited shares at the time of initial issue. Option 4: been received on forfeited shares at the time of initial issue.

Answer: been received on forfeited shares at the time of initial issue. Solution: When shares are forfeited due to non-payment of calls, the company retains the amount already received from the defaulting shareholder. Upon reissue of these forfeited shares, the company can offer them at a discount. The key rule: The maximum discount allowed on reissue = Amount already received (and forfeited) on those shares Understanding through an example: A share of face value ₹10 was originally issued: - First Call: ₹3 paid by shareholder - Second Call: ₹2 paid by shareholder - Third Call: ₹2 - not paid, share forfeited Amount received (forfeited) = ₹3 + ₹2 = ₹5 When reissuing this share: - Can reissue at ₹7 (discount of ₹3) → Allowed, as ₹3 ₹5 Logic: The discount is adjusted against the forfeited amount. Since the company already collected ₹5, it can afford to give up to ₹5 as discount. Any discount beyond this would mean the company is giving away more than what it had received initially. Therefore, the discount cannot exceed the amount that has been received on forfeited shares at the time of initial issue. Correct Option: 4

Company Accounts

Share Capital

Medium

common

Amount of discount allowed on the reissue of forfeited shares cannot exceed the amount that has:-

not been called-up on forfeited shares at the time of initial issue.

been called-up on forfeited shares at the time of initial issue.

not been received on forfeited shares at the time of initial issue.

been received on forfeited shares at the time of initial issue.

✅ Correct Option: 4

When shares are forfeited due to non-payment of calls, the company retains the amount already received from the defaulting shareholder. Upon reissue of these forfeited shares, the company can offer them at a discount.

The key rule: The maximum discount allowed on reissue = Amount already received (and forfeited) on those shares

Understanding through an example:

A share of face value ₹10 was originally issued:

First Call: ₹3 paid by shareholder
Second Call: ₹2 paid by shareholder
Third Call: ₹2 - not paid, share forfeited

Amount received (forfeited) = ₹3 + ₹2 = ₹5

When reissuing this share:

Can reissue at ₹7 (discount of ₹3) → Allowed, as ₹3 < ₹5
Can reissue at ₹5 (discount of ₹5) → Allowed, as ₹5 = ₹5
Cannot reissue at ₹4 (discount of ₹6) → Not allowed, as ₹6 > ₹5

Logic: The discount is adjusted against the forfeited amount. Since the company already collected ₹5, it can afford to give up to ₹5 as discount. Any discount beyond this would mean the company is giving away more than what it had received initially.

Therefore, the discount cannot exceed the amount that has been received on forfeited shares at the time of initial issue.

Correct Option: 4

2025: 14 May Shift 1

Arrange the following capitals in correct sequence as they appears in notes to account-

(A) Subscribed and Not Fully paid-up

(B) Subscribed and Fully paid-up

(D) Nominal Capital

Choose the correct answer from the options given below:

2026: 21 May Shift 1

The credit amount on share forfeiture account relating to shares yet to be reissued :

2026: 23 May Shift 2

JK Limited purchased building from Sumit Ltd. for Rs.6,60,000 and the payment is to be made by the issue of shares of Rs.100 each at a premium of Rs.20. The number of shares to be issued to Sumit Ltd. will be:

2025: 4 June Shift 2

Preference Shares are defined under section ________ of the Companies Act, 2013.

2025: 15 May Shift 1

Securities Premium Account can be used only for the following purposes:

(A) To issue partly paid bonus shares to the extent not exceeding unissued share capital of the company;

(B). Buy back of own shares.

(C). To write-off the expenses of, or commission paid, or discount allowed on any securities of the company;

(D). To pay premium on the redemption of preference shares or debentures of the company.

Choose the correct answer from the options given below:

2025: 3 June Shift 1

Match List-I with List-II

List-I	List-II
(A) For the amount of calls received in advance	(I) Calls in Advance A/c Dr. To Particular Call A/c
(B) Interest on Calls in Advance is due	(II) Sundry Shareholder's A/c Dr. To Bank A/c
(C) The amount of 'Calls in Advance' is adjusted	(III) Bank A/c Dr. To Calls in Advance A/c
(D) Interest on Calls in Advance, For Interest Paid	(IV) Interest on Calls in Advance A/c Dr. To Sundry Shareholder's A/c

Choose the correct answer from the options given below:

Amount of discount allowed on the reissue of forfeited shares cannot exceed the amount that has:-

Solution

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