Question

Surya Ltd. invited applications for 5,00,000 shares of ₹10 each at premium of ₹6 each payable ₹10 on application and balance as allotment money. Manu holding 4,000 shares did not pay the allotment money and his shares were forfeited.

Pass the necessary Journal entries.

Answer 1

JOURNAL
Date	Particulars	L.F.	Dr. (₹)	Cr. (₹)
	Bank A/c      Dr.		50,00,000
	To Share Application A/c			50,00,000
	(Being application money received @ ₹10 per share)
	Share Application A/c     Dr.		50,00,000
	To Share Capital A/c			50,00,000
	(Being application money transferred to Share Capital Account upon allotment)
	Share Allotment A/c     Dr.		30,00,000
	To Securities Premium A/c			30,00,000
	(Being allotment money due on 5,00,000 shares @ ₹6 each entirely as premium)
	Bank A/c (4,96,000 Shares × 6)      Dr.		29,76,000
	Calls-in-Arrears A/c (4,000 Shares × 6)     Dr.		24,000
	To Share Allotment A/c			30,00,000
	(Being allotment money received except on 4,000 shares held by Manu)
	Share Capital A/c (4,000 Shares × 10)     Dr.		40,000
	Securities Premium A/c (4,000 Shares × 6)      Dr.		24,000
	To Forfeited Shares A/c			40,000
	To Calls-in-Arrears A/c			24,000
	(Being 4,000 shares of Manu forfeited for non-payment of allotment money)