Beta Ltd. came up with an issue of 45,00,000 equity shares of ₹10 each at par. 30% of the issue was reserved for the promoters and the balance was offered to the general public. The entire amount being asked for with the

Statement showing the liabilities of underwriters (Firm underwriting shares are treated as unmarked applications) Particulars R S T Gross Liability (3:1:1) 18,90,000 6,30,000 6,30,000 Less: Marked Application 16,50,000 6,00,000 4,50,000 2,40,000 30,000 1,80,000 Less: Unmarked application (Note 1) 1,98,000 66,000 66,000 Surplus of Liability of S 42,000 (36,000) 1,14,000 Less: Surplus of S allocated to R & T in the Ration of 3: 1 (27,000) 36,000 (9,000) Net Liability 15,000 NIL 1,05,000 Add: Firm underwriting 90,000 60,000 30,000 Total Liability 1,05,000 60,000 1,35,000 Amount payable @ ₹10 each share 10,50,000 6,00,000 13,50,000 Underwriting commission @ 2% on face value of shares underwritten 3,78,000 (18,90,000 x 10 x 2%) 1,26,000 (6,30,000 x 10 x 2%) 1,26,000 (6,30,000 x 10 x 2%) Working Note Total Unmarked Applications 1,50,000 (of public) + 90,000 (firm underwriting of R) + 60,000 (firm underwriting of S) + 30,000 (firm underwriting of T) = 3,30,000 R = 3,30,000 × 3/5 = 1,98,000 S = 3,30,000 × 1/5 = 66,000 T = 3,30,000 × 1/5 = 66,000 Note: The question is solved on the assumption that firm underwriting is a part of unmarked applications.