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प्रश्न
Concept Stationary Ltd. invited applications for issuing 3,00,000 shares of ₹ 10 each at a premium of ₹ 3 per share. The amounts were payable as follows:
On application and allotment – ₹ 7 per share.
On first & final call – balance (including a premium of ₹ 3)
Applications were received for 4,00,000 shares & allotment was made as follows:
(i) To applicants for 80,000 shares – 80,000 shares.
(ii) To applicants for 40,000 shares – nil
(iii) The balance of the applicants were allotted shares on a pro-rata basis.
Excess money received with applications was adjusted towards sums due on the first and final call.
Amit, who belonged to category (i) and was allotted 4,000 shares and Veni, who belonged to category (iii) and was allotted 4,400 shares failed to pay the first and final call money. Their shares were forfeited. The forfeited shares were re-issued at ₹ 7 per share fully paid-up.
Pass necessary journal entries for the above transactions in the books of the company.
उत्तर
In the books of Concept Stationary Ltd.
Journal
| Date | Particulars | L.F. |
Debit Amount(₹) |
Credit Amount(₹) |
|
| Bank A/c | Dr. |
28,00,000 |
|
||
| To Share Application & Allotment A/c |
|
28,00,000 |
|||
| (Received application money & allotment on 4,00,000 shares) |
|
|
|||
|
|
|
||||
| Share Application & Allotment A/c | Dr. |
28,00,000 |
|
||
| To Share Capital A/c |
|
21,00,000 |
|||
| To Share First Call A/c |
|
4,20,000 |
|||
| To Bank A/c |
|
2,80,000 |
|||
| (Transfer of application & allotment money to Share Capital) |
|
|
|||
|
|
|
||||
| Share First and Final Call A/c | Dr. |
18,00,000 |
|
||
| To Share Capital A/c |
|
9,00,000 |
|||
| To Security Premium Reserve A/c |
|
9,00,000 |
|||
| (Call money due on 3,00,000 shares) |
|
|
|||
|
|
|
||||
| Bank A/c | Dr. |
13,38,000 |
|
||
| Calls-in-Arrears A/c (18,000 + 24,000) | Dr. |
42,000 |
|
||
| To Share First and Final Call A/c |
|
13,80,000 |
|||
| (Received call money) |
|
|
|||
|
|
|
||||
| Share Capital A/c (8,400 x 10) | Dr. |
84,000 |
|
||
| Security Premium Reserve A/c (8,400 x 3) | Dr. |
25,200 |
|
||
| To Calls in Arrears A/c (18,000 + 24,000) |
|
42,000 |
|||
| To Share Forfeiture A/c |
|
67,200 |
|||
| (Forfeiture of 8400 shares for non-payment of call money) |
|
|
|||
|
|
|
||||
| Bank A/c (8,400 x 7) | Dr. |
58,800 |
|
||
| Share Forfeiture A/c | Dr. |
25,200 |
|
||
| To Share Capital A/c |
|
84,000 |
|||
| (Reissue of 8,400 shares at ₹7 per share) |
|
|
|||
|
|
|
||||
| Share Forfeiture A/c | Dr. |
42,000 |
|
||
| To Capital Reserve A/c |
|
42,000 |
|||
| (Profit on re-issue transferred to Capital Reserve Account) |
|
|
Working Notes
(1) Computation Table
| Categories | Shares Applied | Shares Allotted |
Money received on Application &Allotment @ ₹ 7 each |
Money transferred to Share Capital @ ₹ 7 each |
Excess Application &Allotment money | Amount adjusted on First call | Amount to be refunded |
| I | 80,000 | 80,000 | 5,60,000 | 5,60,000 | |||
| II | 40,000 | Nil | 2,80,000 | 2,80,000 | |||
| III | 2,80,000 | 2,20,000 | 19,60,000 | 15,40,000 | 4,20,000 | 4,20,000 | |
| 4,00,000 | 3,00,000 | 28,00,000 | 21,00,000 | 4,20,000 | 4,20,000 | 2,80,000 |
(2) Calculation of Shares applied to Amit: 4000 shares
Calls in arrears = 4,000 x ₹ 6 = ₹ 24,000
3) Calculation of Shares applied to Veni:
Shares applied by Veni = `(2,80,000)/(2,20,000) xx 4400 = 5600 "shares"`
| Amount unpaid by Veni | |
| Amount received on application (5600 × 7) |
39,200 |
| Less: actual transferred to share capital (4400 × 7) | 30,800 |
| Excess | 8,400 |
| Amount due on first call (4400 x 6) | 26,400 |
| Less: excess adjusted | (8,400) |
| Calls in arrears | 18,000 |
APPEARS IN
संबंधित प्रश्न
What is the maximum amount of discount at which forfeited share can be re-issued?
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Record the journal entries for forfeiture and reissue of shares in the following cases:
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When shares are forfeited, share capital account is _____________.
Answer in one Sentence only :
Give the full form of SEBI.
State, whether the following statements is True or False.
Share forfeited balance is transferred to Capital Reserve Account.
Long Answer Question
Explain the term ‘Forfeiture of Shares’ and give the accounting treatment on forfeiture.
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Vanya Ltd. forfeited 20,000 equity shares of ₹ 100 each for non-payment of first and final call of ₹ 40 per share. The maximum amount of discount at which these shares can be re-issued will be:
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Capital reserves are created from ______.
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₹ 4 on Application and Allotment; ₹ 2 on First Call; ₹ 4 on Second and Final Call.
Following is an extract of the Journal of Roxy Ltd.
| Journal of Roxy Ltd. (an extract) | ||||
| Date | Particulars | L. F. | Dr. (₹) | Cr. (₹) |
| 1. | Share First Call A/c ...Dr. | 28,000 | ||
| To Share Capital A/c | 28,000 | |||
| (Being first call due on ___??___ shares @ ₹ 2 each) | ||||
| 2. | Bank A/c ...Dr. | ?? | ||
| Calls in arrears A/c ...Dr. | 2,000 | |||
| To Share First Call A/c | 28,000 | |||
| (Being first call received on ___??___ shares) | ||||
| 3. | Share Capital A/c ...Dr. | ?? | ||
| To Shares Forfeited A/c | 4,000 | |||
| To Calls in Arrears A/c | ?? | |||
| (Being ___??___ shares of ₹ 10 each forfeited for non-payment of first call) | ||||
| 4. | Share Second & Final Call A/c ...Dr. | 52,000 | ||
| To Share capital A/c | 52,000 | |||
| (Being second & final call due on ___??___ shares @ ₹ 4 each) | ||||
| 5. | Bank A/c ...Dr. | ?? | ||
| Calls in Arrears A/c ...Dr. | 10,000 | |||
| To Share Second & Final Call A/c | 52,000 | |||
| (Being second call received on ___??___ shares) | ||||
| 6. | Share capital A/c ...Dr. | ?? | ||
| To Shares Forfeited A/c | ?? | |||
| To Calls in Arrears A/c | 10,000 | |||
| (Being ___??___ shares of ₹ 10 each forfeited for non payment of final call) | ||||
| 7. | Bank A/c ...Dr. | ?? | ||
| Share Forfeited A/c ...Dr. | ?? | |||
| To Share Capital A/c | ?? | |||
| (Being 1,500 forfeited shares including those on which the first call was not received reissued @ ₹ 6 per shares fully called) | ||||
| 8. | Share Forfeiture A/c (1,000 × 0) + (500 × 2) ...Dr. | ?? | ||
| To Capital Reserve A/c | ?? | |||
| (Being ___??___) | ||||
You are required to complete the journal entries by filling up the missing information represented by '??', including the number of shares and narration, if any.
