Shares

To determine the minimum reissue price for forfeited shares, we follow these steps:

1. Calculate the Called-Up Capital:
Face value per share: Rs 10
First call not paid: Rs 1
Second and final call not paid: Rs 3
Total not paid: Rs 1 + Rs 3 = Rs 4
Called-up capital per share = Face Value - Uncalled amount = Rs 10 - Rs 0 = Rs 10
Amount Paid = Called-up Capital - Unpaid Amount = Rs 10 - Rs 4 = Rs 6

2. Understand Forfeiture and Reissue:
When shares are forfeited, the company essentially cancels the ownership and can reissue them.
The company can reissue forfeited shares at a discount, but the discount cannot exceed the amount that was originally received on those shares. This is to ensure that the original shareholder doesn't benefit unfairly.

3. Determine the Maximum Discount:
Maximum discount allowed per share = Amount received on the forfeited shares = Rs 6

4. Calculate the Minimum Reissue Price:
Minimum reissue price = Called-up value - Maximum Discount = Rs 10 - Rs 6 = Rs 4

Final Answer:
Therefore, the minimum price per share at which these shares can be reissued is Rs 4.

Journal Entries for Share Issue in Alexia Limited

1. Key Information Summarized:

• Issued Shares: 1,00,000
• Face Value: Rs. 10 per share
• Premium: Rs. 10 per share
• Application: Rs. 9 (including Rs. 6 premium)
• Allotment: Rs. 8 (including Rs. 4 premium)
• First & Final Call: Rs. 3
• Applications Received: 1,50,000 shares
• Allotment Ratio:
  • Category A: Applied 90,000, Allotted 70,000
  • Category B: Applied 60,000, Allotted 30,000
• Excess Application Money: Adjusted towards allotment and calls
• Calls in Arrears: Shekhar (Category B), 1200 applied shares, failed to pay First & Final Call.

2. Calculations Before Journal Entries:

• Excess Application Money:
  • Category A: (90,000 - 70,000) × Rs. 9 = Rs. 1,80,000
  • Category B: (60,000 - 30,000) × Rs. 9 = Rs. 2,70,000
  • Total Excess Money = 1,80,000 + 2,70,000 = Rs. 4,50,000
• Shares Allotted to Shekhar: 1200 shares applied for. 30000/60000 × 1200 = 600 shares allotted.
• Amount Due on First & Final Call from Shekhar: 600 shares × Rs. 3 = Rs. 1800

3. Journal Entries

Explanation of Entries:

• Entry 1: Records the total application money received.
• Entry 2: Transfers the application money to share capital and securities premium. Adjust the excess application money to Share Allotment.
• Entry 3: Records the amount due on allotment, including the premium.
• Entry 4: Records the receipt of the allotment money. The debit to bank account represents the total amount received.
• Entry 5: Records the amount due on the first and final call.
• Entry 6: Records the receipt of the first and final call money. The debit to Calls in Arrears reflects the amount not received from Shekhar.

To solve the problem, we need to determine what the minimum subscription of capital cannot be less than 90% of, according to the Securities and Exchange Board of India (SEBI) guidelines.

1. Understanding SEBI Guidelines on Minimum Subscription:
According to SEBI guidelines, the minimum subscription requirement ensures that a company must receive a certain percentage of the capital it offers to the public before proceeding with the allotment of securities. This is to protect investors and ensure the viability of the issue.

2. Identifying the Relevant Term:
SEBI mandates that the minimum subscription for a public issue cannot be less than 90% of the subscribed capital. Subscribed capital refers to the total amount of capital that the company offers for subscription through the public issue, as per the offer document.

Final Answer:
According to Securities and Exchange Board of India (SEBI) guidelines, the minimum subscription of capital cannot be less than 90% of the Subscribed Capital.

To solve the problem, we need to identify the term for the amount of share capital a company is authorised to issue as per its Memorandum of Association.

1. Understanding the Memorandum of Association:
The Memorandum of Association is a legal document that outlines the fundamental details of a company, including its objectives, powers, and scope. One of its key components is the capital clause, which specifies the maximum amount of share capital the company is authorised to issue.

2. Identifying the Term:
The amount of share capital that a company is authorised to issue, as stated in the Memorandum of Association, is known as 'Authorised Capital' (also called Nominal Capital or Registered Capital). This is the maximum limit of share capital that the company can issue without amending its Memorandum.

Final Answer:
The amount of share capital which a company is authorised to issue by its Memorandum of Association is known as Nominal Capital.

To calculate Prabhas' share of goodwill, we follow these steps:

1. Calculate the Total Capital of the New Firm (Based on Prabhas's Share):
Prabhas brings in Rs 2,00,000 for a 1/5 share.
Therefore, the total capital of the new firm should be Rs 2,00,000 * 5 = Rs 10,00,000

2. Calculate the Actual Total Capital of the Firm:
Suhas's capital: Rs 4,00,000
Vilas's capital: Rs 3,00,000
Prabhas's capital: Rs 2,00,000
Actual total capital: Rs 4,00,000 + Rs 3,00,000 + Rs 2,00,000 = Rs 9,00,000

3. Calculate the Hidden Goodwill:
Hidden Goodwill = Total Capital of the New Firm (based on new partner's capital) - Actual Total Capital
Hidden Goodwill = Rs 10,00,000 - Rs 9,00,000 = Rs 1,00,000

4. Calculate Prabhas's Share of Goodwill:
Prabhas's share of goodwill = Total Hidden Goodwill * Prabhas's share
Prabhas's share of goodwill = Rs 1,00,000 * (1/5) = Rs 20,000

Final Answer:
Therefore, Prabhas' share of goodwill is Rs 20,000.

Step 1: Face value per share = 10
Step 2: Amount unpaid on each forfeited share = Final call = 2
Step 3: Amount received = 8 per share Amount forfeited = 8 per share
Step 4: Total shares forfeited = 500 Total amount forfeited =
Step 5: Out of these, 300 shares were reissued at 12 per share (fully paid-up).
Face value = 10, so 2 per share is premium.
Step 6: Maximum amount of forfeiture that can be credited to Capital Reserve = amount forfeited on 300 shares

Step 7: Since shares were reissued at premium, and fully paid-up, there is no discount absorbed from forfeited amount. Entire 2,400 is credited to Capital Reserve.
Bank A/c Dr. & 3,600
To Share Capital A/c & 3,000
To Securities Premium A/c & 600
Share Forfeiture A/c Dr. & 0
To Capital Reserve A/c & 2,400