Question

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.

Answer 1

	Rs.
Application money received (70,000 × Rs. 1)	70,000
Actual amount due (50,000 × Rs. 1)	50,000
	20,000
Less: Refund on rejected application (8,000 × Rs. 1)	8,000
Excess adjusted towards allotment	12,000

 

Date	Particulars	L.F.	Debit ₹	Credit ₹
1.	Bank A/c   Dr.    To Share Application A/c (Share Application money received)		70,000	70,000
2.	Share Application A/c   Dr.    To Bank (Excess Share Application money rejected)		8,000	8,000
3.	Share Application A/c   Dr.   To Share Allotment A/c   To Share Capital A/c (Share Application money tr to share capital)		62,000	12,000 50,000
4.	Share Allotment A/c    Dr.   To Share Capital A/c (Share Allotment transfer to Share Capital)		2,50,000	2,50,000
5.	Bank A/c    Dr.    To Share Allotment A/c (Share Allotment money received)		2,38,000	2,38,000
6.	Share Ist Call A/c   Dr.   To Share Capital A/c (Share Ist Call Due)		1,00,000	1,00,000
7.	Bank A/c   Dr.   To Share Ist Call A/c (Share Ist call money received)		1,00,000	1,00,000
8.	Share final call A/c Dr.   To Share Capital A/c (Share final call due)		1,00,000	1,00,000
9.	Bank A/c   Dr.    To Share final call A/c (Share final call money received)		97,000	97,000
10.	Share Capital A/c    Dr.   To Share forfeited A/c   To Share final call A/c (1,500 shares were forfeited)		15,000	12,000 3,000
11.	Bank A/c   Dr. Share forfeited A/c    Dr.   To Share Capital A/c (1,200 shares were reissued @ ₹ 8% per share)		9,600 2,400	12,000
12.	Share forfeiture A/c   Dr.   To Capital Reserve A/c (Profit on reissue tr to capital reserve A/c)		7,200	7,200

Working note- 

Amount received per share - Rs. 8

Amount used on reissue -     Rs. 2 
                                              Rs. 6 

Profit on reissue × No. of. shares reissued = Rs. 6 × 1,200 = Rs. 7,200