Question

Milind and Co. Ltd. issued 20,000 equity shares of Rs. 100 each payable as under:
On Application Rs. 20 per share.
On Allotment Rs. 35 per share.
On First Call Rs. 25 per share.
On Second Call Rs. 20 per share.
The company received applications for 30,000 equity shares. Applications for 20,000 shares were accepted and allotted shares. Applications for 10,000 shares were rejected and refunded in full. The money due on an allotment and both the calls were received in full. The expenses of issue amounted to Rs. 5,000. Pass necessary journal entries in the books of the company.

Answer 1

Journal
Date	Particulars	L.F.	Debit Amount Rs)	Credit Amount (Rs)
	Bank A/c (30,000 × 20)                Dr.      To Equity Share Application A/c (Application money received)		6,00,000	6,00,000
	Equity Share Application A/c          Dr.      To Equity Share Capital A/c (20,000 × 20)      To Bank A/c (10,000 × 20) (Application money transferred to capital and excess refunded)		6,00,000	4,00,000 2,00,000
	Equity Share Allotment A/c (20,000 × 35)    Dr.      To Equity Share Capital A/c (Allotment money due)		7,00,000	7,00,000
	Bank A/c                        Dr.     To Equity Share Allotment A/c (Allotment money received)		7,00,000	7,00,000
	Equity Share First Call A/c (20,000 × 25)       Dr.     To Equity Share Capital A/c (First, call money due)		5,00,000	5,00,000
	Bank A/c            Dr.     To Equity Share First Call A/c (First call money received)		5,00,000	5,00,000
	Equity Share Second Call A/c (20,000 × 20)     Dr.     To Equity Share Capital A/c Second call money due)		4,00,000	4,00,000
	Bank A/c             Dr.     To Equity Share Second Call A/c (Second call money received)		4,00,000	4,00,000
	Share Issue Expenses A/c           Dr.     To Bank A/c (Expenses paid)		5,000	5,000