When shares are forfeited, the amount already received is credited to:
When shares are forfeited, the amount already received is credited to:
Solution
✅ Correct Option: 1
On forfeiture, Share Capital A/c is debited with the called-up amount and the unpaid calls are credited to the respective calls-in-arrears accounts. The balance, i.e. the amount already received from the defaulting shareholder, is credited to Share Forfeiture A/c. It moves to Capital Reserve only later, after those shares are reissued.
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