Read the following passage and answer the questions

On January 1, 2024, the Director of X Ltd. issued for public subscription 50,000 equity shares of Rs. 10 each at Rs. 12 per share payable, Rs. 5 on application (including premium), Rs. 4 on allotment and the balance on call on May 01, 2024. The issue was closed on February 10, 2024 by which date applications for 70,000 shares were received.

Of the cash received Rs. 40,000 was returned and Rs.60,000 was applied to the amount due on allotment, the balance of which was paid on February 16, 2024. All the shareholders paid the call due on May 01, 2024 with the exception of an allottee of 500 shares. These shares were forfeited on September 29, 2024 and reissued as fully paid at Rs. 8 per share on November 01, 2024. The company, as a matter of policy, does not maintain a calls-in-arrears account.

Q) What is the amount of excess application money credited to share allotment and money refunded on rejected application in totality?

The correct option is Rs. 1,00,000.

Let us break down the details given in the passage to find the total amount of excess application money credited to share allotment and the money refunded on rejected applications in totality:

1. Understanding the Share Application Details:
- Shares issued for public subscription = 50,000 equity shares
- Applications received = 70,000 shares
- Application money per share = Rs. 5 (including premium)

2. Analyzing the Excess Money Received on Application:
- Total applications received = 70,000 shares
- Total shares allotted = 50,000 shares
- Therefore, excess applications = 70,000 shares − 50,000 shares = 20,000 shares
- Total excess application money received = 20,000 shares × Rs. 5 per share = Rs. 1,00,000

3. Treatment of Excess Application Money:
According to the passage, this excess application money of Rs. 1,00,000 was treated as follows:
- Amount of cash returned (refunded on rejected applications) = Rs. 40,000
- Amount applied/credited to share allotment = Rs. 60,000

4. Calculating the Combined (Total) Amount:
The question asks for the sum of both the excess application money credited to share allotment and the money refunded on rejected applications in totality:
- Total Amount = Money Credited to Allotment + Money Refunded
- Total Amount = Rs. 60,000 + Rs. 40,000 = Rs. 1,00,000

Hence, the combined total of excess application money credited to allotment and refunded on rejection is Rs. 1,00,000.