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Pragya Ltd. forfeited 8,000 equity shares of ₹ 100 each issued at a premium of 10% for non-payment of first and final call of ₹ 30 per share. The maximum amount of discount at which these shares can be reissued will be

  • a)
    ₹ 5,60,000

  • b)
    ₹ 3,20,000

  • c)
    ₹ 2,40,000

  • d)
    ₹ 80,000

Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Pragya Ltd. forfeited 8,000 equity shares of 100 each issued at a pre...
Given:
- Pragya Ltd. forfeited 8,000 equity shares of 100 each issued at a premium of 10%
- Non-payment of first and final call of 30 per share

To find:
- Maximum amount of discount at which these shares can be reissued

Solution:
1. Calculation of amount forfeited:
- Face value of each share = 100
- Premium on each share = 10% of 100 = 10
- Total amount received on each share = 100 + 10 = 110
- Non-payment of final call of 30 per share --> Amount received = 110 - 30 = 80
- Forfeited shares = 8,000
- Amount forfeited = 80 x 8,000 = 6,40,000

2. Calculation of maximum discount allowed:
- Discount = Face value - Reissue price
- Reissue price = Amount forfeited / No. of shares to be reissued
- No. of shares to be reissued = Forfeited shares - Bought back shares
- Bought back shares = 0 (not given in the question)
- Therefore, No. of shares to be reissued = Forfeited shares = 8,000
- Reissue price = 6,40,000 / 8,000 = 80
- Face value = 100
- Maximum discount allowed = Face value - Reissue price = 100 - 80 = 20

3. Calculation of maximum amount of discount:
- Maximum discount = Maximum discount allowed x No. of shares to be reissued
- No. of shares to be reissued = 8,000 (as calculated above)
- Maximum discount allowed = 20 (as calculated above)
- Maximum amount of discount = 20 x 8,000 = 1,60,000

4. Calculation of maximum amount of reissue:
- Maximum amount of reissue = Amount forfeited - Maximum amount of discount
- Amount forfeited = 6,40,000 (as calculated above)
- Maximum amount of discount = 1,60,000 (as calculated above)
- Maximum amount of reissue = 6,40,000 - 1,60,000 = 4,80,000

Therefore, the maximum amount of discount at which these shares can be reissued is 20 per share and the maximum amount of reissue is 5,60,000 (option C).
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Community Answer
Pragya Ltd. forfeited 8,000 equity shares of 100 each issued at a pre...
Amount of discount = 8,000 x 70 = ₹ 5,60,000
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Pragya Ltd. forfeited 8,000 equity shares of 100 each issued at a premium of 10% for non-payment of first and final call of 30 per share. The maximum amount of discount at which these shares can be reissued will bea) 5,60,000b) 3,20,000c) 2,40,000d) 80,000Correct answer is option 'C'. Can you explain this answer?
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Pragya Ltd. forfeited 8,000 equity shares of 100 each issued at a premium of 10% for non-payment of first and final call of 30 per share. The maximum amount of discount at which these shares can be reissued will bea) 5,60,000b) 3,20,000c) 2,40,000d) 80,000Correct answer is option 'C'. Can you explain this answer? for Class 12 2024 is part of Class 12 preparation. The Question and answers have been prepared according to the Class 12 exam syllabus. Information about Pragya Ltd. forfeited 8,000 equity shares of 100 each issued at a premium of 10% for non-payment of first and final call of 30 per share. The maximum amount of discount at which these shares can be reissued will bea) 5,60,000b) 3,20,000c) 2,40,000d) 80,000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for Class 12 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Pragya Ltd. forfeited 8,000 equity shares of 100 each issued at a premium of 10% for non-payment of first and final call of 30 per share. The maximum amount of discount at which these shares can be reissued will bea) 5,60,000b) 3,20,000c) 2,40,000d) 80,000Correct answer is option 'C'. Can you explain this answer?.
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