Question

On forfeiture of shares, Calls in Arrears Account will be:

• A. Credited by ₹ 7,000
• B. Debited by ₹ 5,000
• C. Credited by ₹ 5,000
• D. Debited by ₹ 7,000

Hint:

Calls in Arrears represent unpaid amounts due on shares and are credited during forfeiture.

Answer 1

The Correct Option is C

The unpaid call amount for 1,000 shares is ₹ 5 per share, calculated as: \[\text{Calls in Arrears} = 1,000 \times ₹ 5 = ₹ 5,000.\] This sum is then credited to the Calls in Arrears Account following forfeiture.