Question

Gaja Lid issued 40,000 shares of ₹ 10 each of the public payable ₹ 2 on the application, ₹ 5 on the allotment, and ₹ 3 on the first and final call. The application was received for 50,000 shares. The Directors decided to allot 40,000 shares on a pro-rata basis and a surplus of application money was utilized for allotment. Pass journal entries assuming that the amount due was received.

Answer 1

Date	Particulars	L.F.	Debit Rs.	Credit Rs.
1.	Bank A/c (50,000 x Rs. 2)  Dr.     To Equity share application A/c [Application money received on 50,000 share]		1,00,000	1,00,000
2.	Share Application A/c   Dr.   To Share capital A/c (40,000 x Rs.2) 80,000      To Share Allotment A/c 20,000 [Application money transferred & excess adjusted towards allotment]		1,00,000	80,000 20,000
3.	Share Allotment A/c (40,000 x Rs.5)  Dr.    To Share capital A/c [Allotment money due]		2,00,000	2,00,000
4.	Bank A/c  Dr.    To Share Allotment A/c [Allotment Balance money received]		1,80,000	1,80,000
5.	Share I & final call A/c (40,000 x Rs.3)   Dr.    To Share Capital A/c [call money due]		1,20,000	1,20,000
6.	Bank A/c  Dr.    To Share I & final call A/c [call money received]		1,20,000	1,20,000