When forfeited shares are reissued, any profit made on the reissue (i.e., the amount received over the original issue price) is not treated as revenue.
Instead, it is transferred to a Capital Reserve Account because it is a capital profit.
Capital Reserve is used for purposes like writing off capital losses, issuing bonus shares, or strengthening the financial position of the company.
Other options:
Share Capital: Only records the nominal value of shares issued.
Profit & Loss Account: For revenue profits, not capital profits.
Reserve Capital: Portion of uncalled capital, not related to profit on reissue.
