Question

Vishal Ltd. issued 50,000 Equity Shares of ₹10 each payable as follows:

₹2 on application	payable on 1st June 2023
₹3 on allotment	payable on 1st August 2023
₹3 on first call	payable on 1st Nov. 2023
Balance on final call	payable on 1st Jan. 2024

All the shares were subscribed except the following:

1. Shareholder Suresh, holding 1,000 shares did not pay the first call and final call.
2. Shareholder Vasudev, holding 2,000 shares did not pay the final call.

These amounts were due till the date of Balance Sheet on 31st March, 2024. Articles of Association of the Company provided for charging interest on calls in arrears @ 10% p.a.

Pass necessary journal entries and show Share Capital in the Balance Sheet of the company.

Answer 1

Balance Sheet (Extract) as at 31-03-2024
Liabilities	Amt. (₹)	Assets	Amt. (₹)
Share Capital	4,91,000	Interest on Calls in Arrears Receivable	275

 

Journal entries  In the books of Vishal Ltd.
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2020			1,00,000
Jun-01	Bank A/c     ...Dr.			1,00,000
	To Equity Share Application A/c
	(Application money received)
Aug-01	Equity Share Application A/c     ...Dr.		1,00,000
	To Equity Share Capital A/c			1,00,000
	(Application money transferred to share capital account)
Aug-01	Equity Share Allotment A/c     ...Dr.		1,50,000
	To Equity Share Capital A/c			1,50,000
	(Allotment made due)
Aug-01	Bank A/c     ...Dr.		1,50,000
	To Equity Share Allotment A/c			1,50,000
	(Allotment money received)
Nov-01	Equity Share First Call A/c     ...Dr.		1,50,000
	To Equity Share Capital A/c			1,50,000
	(Equity share first call made due)
Nov-01	Bank A/c     ...Dr.		1,47,000
	Calls in Arrears A/c     ...Dr.		3000
	To Equity Share First Call A/c			1,50,000
	(First Call money received, except on 1000 shares)
2021
Jan-01	Equity Share Second and Final Call A/c     ...Dr.		1,00,000
	To Equity Share Capital A/c			1,00,000
	(Share second call made due)
Jan-01	Bank A/c     ...Dr.		94,000
	Calls in Arrears A/c     ...Dr.		6,000
	To Equity Share Second and Final Call A/c			1,00,000
	(Second call money received, except on 2000 shares)
Mar-31	Sundry Members A/c     ...Dr.		275
	To Interest on Calls on Arrears A/c			275
	(Interest charged on Calls in Arrears)
Mar-31	Interest on Calls on Arrears A/c     ...Dr.		275
	To Statement of Profit and Loss A/c			275
	(Interest on calls in arrears transferred to Statement of Profit & Loss)