Question

Zen Ltd. issued 10,000 equity shares of ₹10 each at a premium of ₹3 per share payable as:

On Application	₹4
On Allotment	₹5 (including premium)
On First Call	₹2

The balance as and when required.
The public applied for 12,000 shares. The company made pro-rata allotment to all the applicants. One shareholder who was allotted 900 shares paid the entire amount with allotment while another shareholder who had applied for 1,200 shares, failed to pay the allotment money and on his subsequent failure to pay the first call his shares were forfeited.
Of the forfeited shares, 800 were reissued at ₹7 per share. You are required to prepare:

1. Share Allotment Account,
2. Securities Premium Reserve Account,
3. Share Forfeiture Account, and
4. Calls-in-Arrears Account.

Answer 1

Dr.	Share Allotment Account				Cr.
Date	Particulars	Amt. (₹)	Date	Particulars	Amt. (₹)
	Share Capital A/c	50,000		Application A/c	20,000
	Securities Premium Reserve A/c	30,000		Bank A/c	37,800
				Calls in Arrears A/c	6,200
	Total	80,000		Total	80,000

 

Dr.	Securities Premium Reserve A/c				Cr.
Date	Particulars	Amt. (₹)	Date	Particulars	Amt. (₹)
	Share Forfeiture (allotment prem. on forfeited shares)	3,000		Share Allotment A/c	30,000
				Balance c/d	27,000
	Total	30,000		Total	30,000

 

Dr.	Share Forfeiture A/c				Cr.
Date	Particulars	Amt. (₹)	Date	Particulars	Amt. (₹)
	Discount on Reissue (800 × ₹3)	2,400		Share Capital A/c (₹8 × 1,200)	9,600
	Capital Reserve (Profit on reissue)	6,240
	Balance c/d	960
	Total	9,600		Total	9,600

 

Dr.	Calls in Arrears A/c				Cr.
Date	Particulars	Amt. (₹)	Date	Particulars	Amt. (₹)
	To Share Forfeiture A/c (on forfeiture of 1,200 shares)	8,600		By Share Allotment A/c	6,200
				By Share First Call A/c	2,400
	Total	8,600		Total	8,600