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Question
The amount received over and above the par value is credited to
Options
Securities premium account
Calls in advance account
Share capital account
Forfeited shares account
Solution
Securities premium account
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RELATED QUESTIONS
Write a short note on the securities premium account.
Why are the shares forfeited?
Write a brief note on calls in advance.
Anjali Flour Ltd. with a registered capital of ₹ 4,00,000 in equity shares of ₹ 10 each, issued 30,0 of such shares; payable ₹ 2 per share on the application, ₹ 5 per share on the allotment, and ₹ 3 shares on the first call. The issue was duly subscribed.
All the money payable was duly received but on the allotment, one shareholder paid the entire balance on his holding of 500 shares. Give journal entries to record the I transactions.
Lakshmi was holding 50 hares of ₹ 10 each on which he paid ₹ 2 on application but could not pay ₹ 4 on the allotment and ₹ 2 on first call. Directors forfeited the shares after the first call. Give journal entry for recording the forfeiture of shares.
Nivetha Ltd. forfeited 1,000 equity shares of ₹ 10 each for non-payament of call of ₹ 4 per share. Of these 800 shares were reissued @ ₹ 7 per share. Pass journal entries for forfeiture and reissue?
Simon Ltd issued 50,000 equity shares of ₹ 10 each at par payable on-application ₹ 1 per share, on allotment ₹ 5 per share, on first call ₹ 2 per share, and on second and final call ₹ 2 per share. The issue was fully subscribed and all the amounts were duly received with exception of 2,000 shares held by chezhian, who failed to pay the second and final call. His shares were forfeited and reissued to Elango at ₹ 8 per share. Journalise the above transactions?
Kanchana Ltd. issued 50,000 shares ₹ 10 each payable as under?
On application ₹ 1
On allotment ₹ 5
On first call ₹ 2
On final call ₹ 2
Applications were received for 70,000 shares. Applications for 8,000 shares were rejected and allotment was made proportionately towards the remaining applications. The directories made both the calls and all the amounts were received except the final call on 1,500 shares which were subsequently forfeited. Later 1.200 forfeited shares were reissued by receiving ₹ 8 per share. Give journal entries.
United Industries Ltd. issued shares of ₹ 10 each at 10% premium payable ₹ 3 on the application, ₹ 4 on the allotment (including premium), ₹ 2 on the first call, and ₹ 2 on the final call.
Journalise the transections relating to forfeiture of shares for the following situations:
- Manoj who holds 250 shares failed to pay the second and final call and his shares were forfeited.
- Manoj who holds 250 shares field to pay the allotment money and first call and second and final call and his shares were forfeited.
- Manoj who holds 250 shares failed to pay the allotment money and first call money and his shares were forfeited after the first call.
Kasthuri Ltd. had allotted 20,000 equity shares of ₹ 10 each at a premium of ₹ 2 each to applicants of 30,000 shares on a pro rata basis. The amount payable was ₹ 3 on application, ₹ 5 on allotment (including premium of ₹ 2 each) and ₹ 2 on first call and ₹ 2 on final call. Subin, a shareholder, failed to pay the first call and final call on his 500 shares. All the shares were forfeited and out of them, 400 shares were reissued @ ₹ 8 per share. Pass necessary journal entries.
