Explanation
Forfeiture amount per share is the amount to be received by the company on forfeiture of each share.
$$Forfeiture\quad Amount=Application\quad Amount$$
Substitute the values in above equation
$$Forfeiture\quad Amount=Rs4$$
Forfeiture amount is the money received by company on forfeiture (cancellation of share) or on the reissue of share.
$$Forfeiture\quad Amount= No.\quad of\quad shares \times Forfeiture\quad Amount$$
Substitute the values in the above equation
$$Forfeiture\quad Amount=100shares \times Rs4= Rs400$$
$$Forfeiture\quad amount\quad on\quad reissue=100shares \times Rs3=300$$
Profit on the reissue is the profit earned by the company when the forfeited shares are reissued
$$Profit\quad on\quad reissue=Forfeited\quad Amount\quad on\quad forfeiture$$
$$Profit\quad on\quad reissue= Rs400-Rs300= Rs100$$
Hence, the profit earned on the reissue of shares is Rs $$100$$.
$$Forfeiture\quad Amount=Application\quad Amount\quad +\quad Allotment\quad Amount$$
$$Forfeiture\quad Amount=Rs20 +Rs30= Rs50$$
$$Forfeiture\quad Amount=50 \times50= Rs2500$$
$$Forfeiture\quad Amount\quad for\quad 20\quad shares= 200\times 50= Rs1000$$
$$Forfeiture\quad Amount\quad for\quad reissued\quad shares=20\times 10= Rs200$$
$$Profit\quad on\quad reissue=Forfeited\quad Amount\quad on\quad forfeiture- Forfeited\quad amount\quad on\quad reissue$$
$$Profit\quad on\quad reissue=Rs 1000- Rs 200= Rs 800$$
Hence, the profit earned on the reissue of shares is Rs $$800$$.
Share Forfeiture a/c Dr Rs800
To capital reserve a/c Rs800.
$$Forfeiture\quad Amount=Rs3$$
$$Forfeiture\quad Amount=300shares \times Rs3= Rs900$$
$$Forfeiture\quad Amount\quad for\quad 250share= 250shares \times Rs3= Rs750$$
$$Forfeiture\quad amount\quad on\quad reissue=250shares \times Rs2=500$$
$$Profit\quad on\quad reissue= Rs750-Rs500= Rs250$$
Hence, the profit earned on the reissue of shares is Rs $$250$$.
$$Forfeiture\quad Amount=Application\quad Amount+Allotment\quad Amount$$
$$Forfeiture\quad Amount=Rs20+ Rs30=Rs50$$
$$Forfeiture\quad Amount\quad for\quad 20= shares= 200\times 50= Rs1000$$
$$Forfeiture\quad Amount\quad for\quad reissued\quad shares=20=\times 0= Rs0$$
$$Profit\quad on\quad reissue=Rs1000- Rs0= Rs 1000$$
Hence, the profit earned on the reissue of shares is Rs $$1000$$.
$$Forfeiture\quad Amount=Rs5$$
$$Forfeiture\quad Amount=200shares \times Rs5= Rs1000$$
$$Forfeiture\quad Amount\quad for\quad 100share= 100shares \times Rs5= Rs500$$
$$Forfeiture\quad amount\quad on\quad reissue=100shares \times Rs2=200$$
$$Profit\quad on\quad reissue=Forfeited\quad Amount\quad on\quad forfeiture-Forfeited\quad amount\quad on\quad reissue$$
$$Profit\quad on\quad reissue= Rs500-Rs200= Rs300$$
Hence, the profit earned on the reissue of shares is Rs $$300$$.
Share Forfeiture a/c Dr. Rs300
To share capital a/ Rs300.
$$Forfeiture\quad Amount=Application\quad Amount\quad $$
$$Forfeiture\quad Amount=Rs2$$
$$Forfeiture\quad Amount=10shares \times Rs2= Rs20$$
$$Forfeiture\quad Amount\quad for\quad 8shares=8shares \times Rs2=Rs16$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 8shares\quad \times \quad Rs0\quad =\quad Rs0\\ $$
$$Profit\quad on\quad reissue=Rs16-Rs0 = Rs16$$
Hence, the profit earned on the reissue of shares is Rs $$16$$.
$$Forfeiture\quad Amount=Rs30\quad +\quad Rs30\quad =\quad Rs60$$
Forfeiture amount is the money received by the company on forfeiture (cancellation of share) or on the reissue of share.
$$Forfeiture\quad Amount=50shares \times Rs60= Rs3,000$$
$$Forfeiture\quad Amount\quad for\quad 20shares=20shares \times Rs60=Rs1200$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 20shares\quad \times \quad Rs50\quad =\quad Rs1000\\ $$
$$Profit\quad on\quad reissue=Rs1200-Rs 1000=Rs200$$
Hence, the profit earned on the reissue of shares is Rs $$200$$
Share forfeiture a/c $$Dr. Rs200$$
To capital reserve a/c $$Rs200$$
Substitute the values in the above equation$$Forfeiture\quad Amount=10shares \times Rs2= Rs20$$
$$Forfeiture\quad Amount\quad for\quad 8share= 8shares \times Rs2= Rs16$$
$$Forfeiture\quad amount\quad on\quad reissue=8shares \times Rs2=Rs16$$
$$Profit\quad on\quad reissue= Rs16-Rs16= Rs0$$
Hence, the profit earned on the reissue of shares is Rs $$00$$.
$$Forfeiture\quad Amount=300 \times3= Rs900$$
$$Forfeiture\quad Amount\quad for\quad 200\quad shares= 200\times 3= Rs600$$.
$$Forfeiture\quad Amount\quad for\quad reissued\quad shares=200\times 2= Rs400$$
$$Profit\quad on\quad reissue=Rs 600- Rs 400= Rs 200$$
Hence, the profit earned on the reissue of shares is Rs $$200$$.
Substitute the values in the above equation$$Forfeiture\quad Amount=100shares \times Rs5= Rs500$$
$$Forfeiture\quad amount\quad on\quad reissue=50shares \times Rs2+50shares×Rs3=Rs250$$
$$Profit\quad on\quad reissue= Rs500-Rs250= Rs250$$
Substitute the values in the above equation$$Forfeiture\quad Amount=50shares \times Rs3= Rs150$$
$$Forfeiture\quad amount\quad on\quad reissue=50shares \times Rs12=Rs600$$
$$Profit\quad on\quad reissue= Rs150= Rs510$$
Hence, the profit earned on the reissue of shares is Rs $$150$$.
$$Forfeiture\quad Amount=Rs30$$
Substitute the values in the above equation$$Forfeiture\quad Amount=200shares \times Rs30= Rs6000$$
$$Forfeiture\quad amount\quad on\quad reissue=200shares \times Rs10=Rs.2000$$
$$Profit\quad on\quad reissue= Rs6000-Rs2000= Rs4000$$
Hence, the profit earned on the reissue of shares is Rs $$4000$$.
$$Forfeiture\quad Amount=20shares \times Rs5= Rs100$$
$$Forfeiture\quad Amount\quad for\quad 15shares=15shares \times Rs5=Rs75$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 15shares\times Rs0\quad = Rs0\\ $$
$$Profit\quad on\quad reissue=Rs75-Rs0 = Rs75$$
Hence, the profit earned on the reissue of shares is Rs $$75$$.
Share forfeiture a/c Dr Rs75
To share capital a/c Rs75.
$$Forfeiture\quad Amount=200shares \times Rs5= Rs1,000$$
$$Forfeiture\quad Amount\quad on\quad 50shares=\quad 50shares\times Rs5\quad =Rs250$$
$$Forfeiture\quad amount\quad on\quad reissue=50shares \times Rs2=Rs100$$
$$Profit\quad on\quad reissue=Forfeited\quad Amount\quad on\quad forfeiture-Forfeited\quad Amount \quad on \quad reissue $$
$$Profit\quad on\quad reissue= Rs250-Rs100= Rs150$$
Hence, the profit on the reissue of shares is Rs $$150$$.
Substitute the values in the above equation$$Forfeiture\quad Amount=100shares \times Rs2= Rs200$$
$$Forfeiture\quad Amount\quad for\quad 80share= 80shares \times Rs2= Rs160$$
$$Forfeiture\quad amount\quad on\quad reissue=80shares \times Rs2=Rs160$$
$$Profit\quad on\quad reissue= Rs160-Rs160= Nil$$
Hence, the profit earned on the reissue of shares is $$Nil$$.
$$Forfeiture\quad Amount=Rs8$$
$$Forfeiture\quad Amount=1000shares\times Rs8= Rs8,000$$
$$Forfeiture\quad amount\quad on\quad reissue=1000sahres \times Rs2=Rs2,000$$
$$Profit\quad on\quad reissue=Forfeited\quad Amount\quad on\quad forfeiture+Forfeited\quad Amount \quad on \quad reissue $$
$$Profit\quad on\quad reissue= Rs8,000-Rs2,000= Rs6,000$$
Hence, the profit n reissue is Rs $$6,000$$.
$$Forfeiture\quad Amount=160shares \times Rs2= Rs320$$
$$Forfeiture\quad Amount\quad on\quad 40shares=\quad 40shares\times Rs2\quad =Rs80$$
$$Forfeiture\quad amount\quad on\quad reissue=40shares \times Rs1=Rs40$$
$$Profit\quad on\quad reissue= Rs80-Rs40= Rs40$$
Hence, the profit on the reissue of shares is Rs $$40$$.
$$Forfeiture\quad Amount=500shares \times Rs5= Rs2500$$
$$Forfeiture\quad Amount\quad for\quad 125shares=125shares \times Rs5=Rs625$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 125shares\quad \times \quad Rs1\quad = Rs125\\ $$
$$Profit\quad on\quad reissue=Rs625-Rs125 = Rs500$$
Hence, the profit earned on the reissue of shares is Rs $$500$$.
$$Forfeiture\quad Amount=100shares \times Rs30= Rs3000$$
$$Forfeiture\quad amount\quad on\quad reissue=100shares \times Rs30=Rs3000$$
$$Profit\quad on\quad reissue= Rs3000-Rs3000= Rs0$$
Hence, the profit earned on the reissue of shares is Rs $$0$$.
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 8shares\times Rs0\quad = Rs0\\ $$
The extra 1 rupee paid by the shareholder on the reissue is not considered because it is a part of the security premium, not share forfeiture amount.
$$Profit\quad on\quad reissue=Forfeited\quad Amount\quad on\quad forfeiture\quad -\quad Forfeited\quad Amount\quad on\quad Reissue$$
Share forfeiture a/c Dr. Rs16
To share forfeiture a/c Rs16.
$$Forfeiture\quad Amount=Rs50$$
$$Forfeiture\quad Amount=100shares \times Rs50= Rs5,000$$
$$Forfeiture\quad Amount\quad for\quad 40shares=40shares \times Rs50=Rs2,000$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 40shares\times Rs10\quad = Rs400\\ $$
$$Profit\quad on\quad reissue=Rs2,000-Rs400 = Rs1,600$$
Hence, the profit earned on the reissue of shares is Rs $$1,600$$.
$$Forfeiture\quad Amount\quad=Application\quad per\quad share$$
$$Forfeiture\quad Amount\quad =Rs6$$
$$Total\quad share\quad forfeiture\quad Amount\quad =\quad Shares\quad forfeited\quad \times \quad Forfeiture\quad amount\quad$$
Substitute values in the above equation
$$Total\quad share\quad forfeiture\quad Amount\quad =\quad 48shares\times Rs6\\ \quad =Rs288\quad \quad$$
Thus, the amount to be credited to share forfeiture account is $$Rs288$$ while shares are being forfeited or canceled.
$$Forfeiture\quad Amount=100shares \times Rs5= Rs500$$
$$Forfeiture\quad Amount\quad for\quad 70shares=70shares \times Rs5=Rs350$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 7shares\times Rs0\quad = Rs0\\ $$
$$Profit\quad on\quad reissue=Rs350-Rs0 = Rs350$$
Hence, the profit earned on the reissue of shares is Rs $$350$$.
$$Forfeiture\quad Amount=Rs10$$
$$Forfeiture\quad Amount=200shares \times Rs10= Rs2,000$$
$$Forfeiture\quad Amount\quad for\quad 80shares=80shares \times Rs10=Rs800$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 80shares\times Rs5\quad = Rs400\\ $$
$$Profit\quad on\quad reissue=Rs800-Rs400 = Rs400$$
Hence, the profit earned on the reissue of shares is Rs $$400$$.
Share forfeiture a/c Dr. Rs400
To share capital a/c Rs400.
$$Forfeiture\quad Amount=80shares \times Rs5= Rs400$$
$$Forfeiture\quad Amount\quad for\quad 20shares=20shares \times Rs5=Rs100$$
$$Forfeiture\quad Amount\quad on\quad reissue=\quad 20shares\times Rs2\quad = Rs40\\ $$
$$Profit\quad on\quad reissue=Rs100-Rs40 = Rs60$$
Hence, the profit earned on the reissue of shares is Rs $$60$$.
Substitute the values in the above equation$$Forfeiture\quad Amount=100shares \times Rs50= Rs5000$$
$$Forfeiture\quad amount\quad on\quad reissue=100shares \times Rs10=Rs1000$$
$$Profit\quad on\quad reissue= Rs5000-Rs1000= Rs4000$$
Hence, the profit earned on the reissue of shares is Rs $$4000$$ and credited to capital reserve account.
$$Forfeiture\quad Amount=100shares \times Rs8= Rs800$$
$$Forfeiture\quad amount\quad on\quad reissue=100shares \times Rs1=Rs100$$
Profit on the reissue is the profit earned by the company when the forfeited shares are reissued and transferred to capital reserve account
$$Profit\quad on\quad reissue= Rs800-Rs100= Rs700$$
Hence, the amount credited to capital reserve accountis Rs $$700$$.
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