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Diwan Ltd. was registered… (Class 12 Accountancy 2026, Q23)

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AccountancyCBSE Class 12 · Board exam 2026, set 67/5/1 · 6 marks · Case-based

CBSE Class 12 Accountancy 2026: question 23

Set in the CBSE Class 12 board exam of 2026, paper 67/5/1, section A, question 23, for 6 marks. Try it first; the hints and our step-by-step solution are below.

Q23 · 6 marks · Case-basedCompetency-basedAccounting for Share Capital

Diwan Ltd. was registered with an authorised capital of ₹ 1,00,00,000, divided into 1,00,000 equity shares of ₹ 100 each. The company invited applications for issuing 50,000 shares. The amount was payable as follows :
On Application and Allotment – ₹ 30 per share
On First call – ₹ 40 per share
On Second and Final call – balance
The issue was fully subscribed. All amounts were duly received except from Nawal, a shareholder holding 700 shares, who failed to pay the second and final call. His shares were forfeited.
On the basis of the above information, answer the following questions :

  1. (i)

    The Registered capital of Diwan Ltd. is :

    1. (A)₹ 1,00,00,000
    2. (B)₹ 1,00,000
    3. (C)₹ 50,00,000
    4. (D)₹ 50,000
    1 mark
  2. (ii)

    The Issued capital of Diwan Ltd. is :

    1. (A)₹ 1,00,00,000
    2. (B)₹ 1,00,000
    3. (C)₹ 50,00,000
    4. (D)₹ 50,000
    1 mark
  3. (iii)

    Calls in arrears of the company amounted to :

    1. (A)₹ 21,000
    2. (B)₹ 70,000
    3. (C)Nil
    4. (D)₹ 49,000
    1 mark
  4. (iv)

    'Share Forfeiture Account' will appear in the 'Notes to Accounts' at :

    1. (A)₹ 21,000
    2. (B)₹ 70,000
    3. (C)Nil
    4. (D)₹ 49,000
    1 mark
  5. (v)

    The amount of 'Share Capital' presented in the Balance Sheet of Diwan Ltd. will be :

    1. (A)₹ 49,30,000
    2. (B)₹ 50,00,000
    3. (C)₹ 49,79,000
    4. (D)₹ 49,49,000
    1 mark
  6. (vi)

    If all the forfeited shares are reissued at ₹ 30 per share, fully paid-up, the amount transferred to 'Capital Reserve' will be :

    1. (A)₹ 49,000
    2. (B)₹ 70,000
    3. (C)₹ 21,000
    4. (D)Nil
    1 mark

Source: official question paper from cbse.gov.in (PDF). See it in the full 2026 board paper, set 67/5/1.

Hints

Open one hint at a time and try again before the next.

Hint 1

Registered = authorised; issued = shares offered.

Hint 2

After forfeiture, calls in arrears on those shares disappear.

Hint 3

Share Forfeiture is added to paid-up capital in the Balance Sheet.

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. (i) Registered (authorised) capital = 1,00,000 × ₹ 100 = ₹ 1,00,00,000. Option (A).

    1 mark

  2. (ii) Issued capital = 50,000 × ₹ 100 = ₹ 50,00,000. Option (C).

    1 mark

  3. (iii) Nawal's unpaid final call was cancelled when his shares were forfeited, so calls in arrears are Nil. Option (C).

    1 mark

  4. (iv) Nawal had paid ₹ 30 + ₹ 40 = ₹ 70 per share: Share Forfeiture = 700 × 70 = ₹ 49,000. Option (D).

    1 mark

  5. (v) Share capital = (50,000 − 700) × ₹ 100 = ₹ 49,30,000 plus Share Forfeiture ₹ 49,000 = ₹ 49,79,000. Option (C).

    1 mark

  6. (vi) Reissue at ₹ 30 fully paid gives a discount of ₹ 70 per share = ₹ 49,000, which uses the whole forfeited amount; nothing is left for Capital Reserve: Nil. Option (D).

    1 mark

Answer: (i) A ₹ 1,00,00,000 (ii) C ₹ 50,00,000 (iii) C Nil (iv) D ₹ 49,000 (v) C ₹ 49,79,000 (vi) D Nil

Where the marks are

  • Each part (1 mark each)

Revise the chapter

Practise this chapterBoard-style questions from Accounting for Share Capital, one at a time, marked against the answer key and marking points.Back to the full paper2026 board paper, set 67/5/1: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.