Comprehension Passage
Faltu Limited invited applications for 2,00,000 shares of Rs. 10 each. These shares were issued at a premium of Rs. 11 each which was allowed at the time of allotment. All money was called and duly received except on 10,000 shares on which only application money of Rs. 3 per share was received.
What is the significance of re-issuing forfeited shares at a discount or premium?
1
It increases the company's liabilities.
2
It decreases the Share Premium account.
3
It requires approval from all shareholders.
4
It can enhance the company’s capital base and liquidity.