Question

Modern Chemicals Co. Ltd. made an issue of 60,000 shares of Rs. 20 each payable as follows:

On application Rs. 5 per share

On allotment Rs. 5 per share

On first call Rs. 4 per share

On second call Rs. 3 per share

The company received applications for 65,000 shares of which applications for 5,000 shares were rejected and money refunded.

All the shareholders paid up to second call except one shareholder, Mr. Bhupendra, the allotee of 100 shares, who did not pay the amount of the second call.

Give Journal Entries in the books of Modern Chemicals Co., Ltd.

Answer 1

 

Journal of Modern Chemicals Co. Ltd.
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
1	Bank A/c    ...Dr.		3,25,000	-
	To Equity Share Application A/c		-	3,25,000
	(Being share application money Rs. 5 per share received on 65000 shares)
2	Equity Share Application A/c    ...Dr		3,25,000	-
	To Equity Share Capital A/c		-	3,00,000
	To Bank A/c		-	25,000
	(Being application money transferred to share capital and excess application money refunded.)
3	Equity Share Allotment A/c    ...Dr.		3,00,000	-
	To Equity Share Capital A/c		-	3,00,000
	(Being allotment money of Rs. 5 per share due on 60000 shares)
4	Bank A/c    ...Dr.		3,00,000	-
	To Equity Share Allotment A/c		-	3,00,000
	(Being allotment money received)
5	Equity Share First Call A/c    ...Dr.		2,40,000	-
	To Equity Share Capital A/c		-	2,40,000
	(Being first call money of Rs. 4 per share due on 60000 shares)
6.	Bank A/c     ...Dr.		2,40,000	-
	To Equity Share First Call A/c		-	2,40,000
	(Being first call money received)
7	Equity Share second call A/c    ...Dr.		1,80,000	-
	To Equity Share Capital A/c		-	1,80,000
	(Being second call money Rs. 3 per share due on 60000 shares)
8	Bank A/c    ...Dr.		1,79,700	-
	Equity Share Second call in Arrears A/c    ...Dr.		300	-
	To Equity Share Second call A/c		-	1,80,000
	(Being second call money received on all shares except 100 shares)