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CUET Accountancy 2025 PYQs15 May Shift 1. Free, no login required.

Company Accounts

past year questions, CUET Accountancy 2025 15 May Shift 1

Share Capital

past year questions, Company Accounts, CUET Accountancy 2025 15 May Shift 1

Medium

Comprehension:

Read the following passage and answer the questions

On January 1, 2024, the Director of X Ltd. issued for public subscription 50,000 equity shares of Rs. 10 each at Rs. 12 per share payable, Rs. 5 on application (including premium), Rs. 4 on allotment and the balance on call on May 01, 2024. The issue was closed on February 10, 2024 by which date applications for 70,000 shares were received. Of the cash received Rs. 40,000 was returned and Rs. 60,000 was applied to the amount due on allotment, the balance of which was paid on February 16, 2024. All the shareholders paid the call due on May 01, 2024 with the exception of an allottee of 500 shares. These shares were forfeited on September 29, 2024 and reissued as fully paid at Rs. 8 per share on November 01, 2024. The company, as a matter of policy, does not maintain a calls-in-arrears account.

What is the amount of Profit on reissue of Forfeited Shares Accounts transferred to capital reserve?

Solution

✅ Correct Option: 4

The face value of each share is Rs. 10, and the premium is Rs. 2 per share (Rs. 12 - Rs. 10).

Analyzing the payment structure:

  • Application: Rs. 5 (includes Rs. 2 premium + Rs. 3 towards share capital)
  • Allotment: Rs. 4
  • Call: Rs. 3 (balance amount)

For the 500 forfeited shares, the shareholder had paid:

  • Application: Rs. 5 per share
  • Allotment: Rs. 4 per share
  • Call: Not paid (Rs. 3 per share)

When shares are forfeited, the premium amount is not credited to Share Forfeiture Account. Only the amount received towards share capital is forfeited.

Amount credited to Share Forfeiture Account:

  • From application (towards share capital only): Rs. 3 per share
  • From allotment: Rs. 4 per share
  • Total per share: Rs. 7

Total in Share Forfeiture Account = 500 shares × Rs. 7 = Rs. 3,500

On reissue at Rs. 8 per share:

Discount on reissue = Face value - Reissue price = Rs. 10 - Rs. 8 = Rs. 2 per share

Total discount to be adjusted = 500 shares × Rs. 2 = Rs. 1,000

This discount is adjusted against Share Forfeiture Account.

Amount transferred to Capital Reserve:

Capital Reserve = Balance in Share Forfeiture Account - Discount on reissue

Capital Reserve = Rs. 3,500 - Rs. 1,000 = Rs. 2,500

Option 4: Rs. 2500 is correct.

Related questions:

2025: 24 May Shift 1

The amount of Securities Premium can be used only for the following purposes:

(A) To write off preliminary expenses.

(B) To make partly paid shares as fully paid up.

(C) To issue fully paid bonus shares.

(D) Purchase of its own shares.

Choose the correct answer from the options given below:

2026: 31 May Shift 1

Which of the following statements are correct in respect of share capital?

A. Share application money received in excess is adjusted towards allotment.

B. Calls in advance is shown under share capital

C. Securities premium can be used to issue fully paid bonus shares

D. Share forfeiture account is a capital gain

Choose the correct answer from the options given below:

2025: 15 May Shift 2

It is available only for the creditors on winding up of the company.

2022: 16 July Shift 2

Amount of Security Premium Reserve credited at the time of allotment of Shares will be

2025: 13 May Shift 2

Match List-I with List-II

List-IList-II
(A) Reserve Capital(I) That portion of the subscribed capital which has not yet been called up.
(B) Uncalled Capital(II) It is that part of the issued capital which has been actually subscribed by the public.
(C) Paid up Capital(III) A company may reserve a portion of its uncalled capital to be called only in the event of winding up of the company.
(D) Subscribed Capital(IV) It is that portion of the called up capital which has been actually received from the shareholders.

Choose the correct answer from the options given below:

2026: 21 May Shift 1

Mukesh Ltd. offered 4,00,000 shares, of Rs. 10 each to the public for subscription, to be received as Rs. 2 on application, Rs. 3 on allotment, Rs. 3 on first call and the balance on final call. The company received applications for 4,50,000 shares. The company finalised the allotment of 4,00,000 shares and rejected applications for 50,000 shares. The company did not make the final call. The company received all the amount except on 20,000 shares where call money has not been received. The amount of share capital that will be shown in the balance sheet of Mukesh Ltd. as:

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