Aman Paints Ltd. invited applications for issuing 1,60,000 equity sharesof ` 10 each at a premium of ` 3 per share. The amount was payable asfollows:On Application – ` 6 per share (including premium ` 1);On Allotment – ` 3 per share (including premium ` 1); andOn First and Final Call – BalanceApplications for 1,80,000 shares were received. Applications for 10,000shares were rejected and pro-rata allotment was made to the remainingapplicants. Over payment received on application was adjusted towardssum due on allotment. All calls were made and were duly received exceptallotment and final call from Aditya who was allotted 3,200 shares.His shares were forfeited. Half of the forfeited shares were reissued for` 43,000 as fully paid up
Question
Aman Paints Ltd. invited applications for issuing 1,60,000 equity sharesof 10 each at a premium of 3 per share. The amount was payable asfollows:On Application – 6 per share (including premium 1);On Allotment – 3 per share (including premium 1); andOn First and Final Call – BalanceApplications for 1,80,000 shares were received. Applications for 10,000shares were rejected and pro-rata allotment was made to the remainingapplicants. Over payment received on application was adjusted towardssum due on allotment. All calls were made and were duly received exceptallotment and final call from Aditya who was allotted 3,200 shares.His shares were forfeited. Half of the forfeited shares were reissued for` 43,000 as fully paid up
Solution
The problem is about the issue of shares by Aman Paints Ltd. and the subsequent events. Here's a step-by-step solution:
Step 1: Calculate the total amount received on application.
The company received applications for 1,80,000 shares, out of which 10,000 were rejected. So, valid applications were for 1,70,000 shares. The application money per share was 6, so total money received on application = 1,70,000 shares * 6/share = `10,20,000.
Step 2: Calculate the amount adjusted towards allotment.
The company issued shares to the applicants on a pro-rata basis. So, the number of shares allotted = 1,60,000 shares. The overpayment received on application was adjusted towards the sum due on allotment. So, the amount adjusted = 10,20,000 - (1,60,000 shares * 6/share) = `60,000.
Step 3: Calculate the amount received on allotment.
The allotment money per share was 3. But since 1 per share was already received with the application, the remaining amount due on allotment = 2 per share. So, total money received on allotment = (1,60,000 shares * 2/share) + 60,000 = 3,80,000.
Step 4: Calculate the amount due on the final call.
The balance amount was due on the final call. Since 7 (6 on application and 1 on allotment) was already paid, the remaining amount due = 10 - 7 = 3 per share. So, total money due on final call = 1,60,000 shares * 3/share = 4,80,000.
Step 5: Calculate the amount forfeited.
Aditya, who was allotted 3,200 shares, did not pay the allotment and final call money. So, the amount forfeited = 3,200 shares * 7/share = 22,400.
Step 6: Calculate the amount received on reissue.
Half of the forfeited shares were reissued. So, the number of shares reissued = 3,200 shares / 2 = 1,600 shares. These were reissued for 43,000 as fully paid up. So, the amount received on reissue = 43,000.
So, the total amount received by the company = 10,20,000 (on application) + 3,80,000 (on allotment) + 4,80,000 (on final call) - 22,400 (forfeited) + 43,000 (on reissue) = 18,00,600.
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