Question

Amit holds 100 shares of Rs. 10 each, on which he has paid Rs. 1 per share as application money. Bimal holds 200 shares of Rs. 10 each on which he has paid Rs. 1 and Rs. 2 per share as application and allotment money, respectively. Chetan holds 300 shares at Rs. 10 each and has paid Rs. 1 on application, Rs. 2 on allotment, and Rs. 3 for the first call. They all failed to pay their arrears, and upon the second call of Rs. 2 per share, the directors therefore forfeited their shares. The shares are subsequently reissued for Rs. 11 per share, fully paid. Journalise the transactions.

Answer 1

Journal Entries
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1.	Share capital A/c   ...Dr.		4,800	-
	To Share Allotment (100 × 2)		-	200
	To Share First Call A/c (300 × 3)		-	900
	To Share Second Call A/c (600 × 2)		-	1,200
	To Share Forfeiture A/c		-	2,500
	(600 shares @ Rs. 10 per share, Rs. 8 called-up forfeited after making Second Call)
2.	Bank A/c  ....Dr.		6,600	-
	To Share Capital A/c		-	6,000
	To Securities Premium A/c		-	600
	(600 shares @ Rs 10 each for Rs 11 per share fully paid-up reissued)
3.	Share Forfeiture A/c   ...Dr.		2,500	-
	To Capital Reserve A/c		-	2,500
	(Balance of Share Forfeiture Account transferred to Capital Reserve Account after reissue)

Working Notes:

Calculation of amount transferred to capital reserve:

Particulars	Amount (₹)
Application money received from Amit (100 shares × ₹ 1 )	100
Application and allotment money received from Bimal (200 shares × ₹ 3)	600
Application, allotment and first call money received from Chetan (300 shares × ₹ 6)	1,800
Transferred to capital reserve	2,500