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Thread Starter
Sugam SMSo this is like exception to this rule, Forfeited amt>loss on reissue. Here no loss on reissue there is gain of rs 5. So it's quite confusing
There is no loss on the reissue. Re-issue at a premium of Rs. 5(face value 100)
Thread Starter
Sugam SMWhy did you deduct 35k forfeiture amt as the shares were reissued at premium of 5rs. So The whole amt i.e.,70 per share*500=35000 as capital reserve is having only credit balance of which 35k transferred to capital reserve.
For 500 shares - Forfeiture amount is 35,000 - Since there is no loss on reissue - entire amount is transferred to Capital Reserve. In shares forfeiture account balance left is 49,000.
Thread Starter
Sugam SMSo I wrote as sir said as there is rule forfeited shares> loss on reissue so here the shares are reissued at premium. So no discount on reissue and hence entire forfeiture amount is transferred to capital reserve i.e., the one which we collected
But you do it only for the shares reissued
Thread Starter
Sugam SMHow would you calculate sir?
Amount to be transferred to capital reserve = 500 x 70 = 35,000 In share forfeiture account - balance c/d 49,000 You can prepare in tabular format as well or on per share basis as well. This working will max carry 1 mark
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