Practice Forfeiture And Reissue Of Shares (2.2.3.3)

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6 sample questions

Question 1.
What does forfeiture of shares mean?
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Think about what happens when bills aren't paid.
Question 2.
Can forfeited shares be reissued?
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Consider the company's opportunity to regain capital.
3Question 3.
What happens during the forfeiture of shares?
- The company loses capital
- The company gains capital
- The shares are sold to someone else
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Think about the impact of unpaid dues on company funds.
4Question 4.
Is a company allowed to reissue forfeited shares at any price?
- True
- False
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Consider the legal limits on pricing after forfeiture.
Question 5.
A company with a total of ₹2,000 in unpaid calls on 500 shares decides to forfeit them. Identify steps and potential journal entries involved.
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How do you track the loss of capital due to forfeiture?
Question 6.
The company reissues half of its forfeited shares at a ₹10 discount and the total unpaid calls were ₹2,000. Draft the journal entries.
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What happens to the accounts when shares are reissued?

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