# Solution - Issue at Par and Premium and at Discount

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#### Question

JS Ltd. invited applications for issuing 80,000 equity shares of Rs.10 each at a premium of Rs.6 per share. The amount was payable as follows:

On application - Rs.4 per share (including premium Rs.1 per share)

On Allotment - Rs.6 per share (including premium Rs.3 per share)

On First and Final Call — Balance

Applications for 1,60,000 shares were received. Applications for 40,000 shares were rejected and application money refunded. Shares were allotted on pro-rata basis to the remaining applicants. Excess money received with applications was adjusted towards sums due on allotment. Raman holding 400 shares failed to pay the allotment money. His shares were forfeited immediately after allotment. Afterwards the final call was made. Veer who had applied for 1,200 shares failed to pay the final call. His shares were also forfeited. Out of the forfeited shares 500 shares were re-issued at Rs.8 per share fully paid-up. The re-issued shares included all the forfeited shares of Raman.

Pass necessary journal entries for the above transactions in the books of J.S. Ltd.

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#### Similar questions

SK Ltd. invited applications for issuing 3,20,000 equity shares of Rs.10 each at a premium of Rs.5 per share. The amount was payable as follows:

On application Rs.3 per share (including premium Rs.1 per share)

On allotment Rs.5 per share (including premium Rs.2 per share)

On First and Final Call - Balance

Applications for 4,00,000 shares were received. Applications for 40,000 shares were rejected and application money refunded. Shares were allotted on pro-rata basis to the remaining applicants. Excess money received with applications was adjusted towards sums due on allotment. Jeevan holding 800 shares failed to pay the allotment money and his shares were immediately forfeited. Afterwards final call was made. Ganesh who had applied for 2,700 shares failed to pay the final call. His shares were also forfeited. Out of the forfeited shares 1,500 shares were re-issued at Rs.8 per share fully paid up. The re-issued shares included all the forfeited shares of Jeevan.

Pass necessary journal entries for the above transactions in the books of the company.

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BBG Ltd. had issued 1,00,000 equity shares of Rs.10 each at a premium of Rs.3 per share payable with application money. While passing the journal entries related to the issue, some blanks are left. You are required to complete these blanks.

Books of BBG Ltd

Journal

 Date Particulars L.F. Dr.(Rs.) Cr.(Rs.) 2015Jan 05 _ _ _ _ _ _ _ _ _ _ _                                                                                                                 Dr             To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _(Amount received on application for 1,40,000) shares @ Rs.6 per share including premium) Jan 17 Equity Share Application A/c                                                                                                     Dr                  To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                  To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                  To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                  To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Transfer of application money to share capital securities premium, money refunded for 20,000 shares for rejected application and balance adjusted towards amount due on allotment as shares were allotted on Pro-rata basis) Jan 17 _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr                 To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Amount due on allotment @ Rs.4 per share) Feb 20 _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                                                                                              Dr                   To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Balance amount received on allotment) April 01 _ _ _ _ _ _ _ _ _                                                                                                                        Dr                 To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _(First and Final Call money due) April 20 _ _ _ _ _ _ _ _ _ _                                                                                                                     DrCalls – in – arrears A/c                                                                                                               Dr              To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Money received on First and Final Call) 3,000 May 20 _ _ _ _ _ _ _ _ _                                                                                                                        Dr               To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _               To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _(Forfeited the shares on which call money was not received) June 15 _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr_ _ _ _ _ _ _ _ _ _                                                                                                                     Dr               To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _(Re-issued the forfeited shares) 3,000 _ _ _ _ _ _ _ _ _ _ _ _ _ __                                                                                                                      Dr              To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _(_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ __ )
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Samachar India Ltd. took over the assets of Rs 14,00,000 and liabilities of Rs 4,00,000 from News Ltd. for a purchase consideration of Rs 9,19,000. Samachar India Ltd. issued a promissory note of Rs 17,000 payable after 60 days in favour of News Ltd. and the balance amount was paid by issue of equity shares of Rs 100 each at a premium of Rs 25 per share.

Pass necessary Journal entries for the above transactions in the books of Samachar India Ltd.

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What do you mean by ‘issue of shares at premium’?

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GG Ltd has issued 50,000 equity shares of 10 each at a premium of 2 per share payable with application money. The incomplete journal entries related to the issue are given below. You are required to complete these blanks.

Books of GG Ltd

Journal

 Date Particulars L.F. Dr.(Rs.) Cr.(Rs.) 2015Jan 10 _ _ _ _ _ _ _ _ _ _ _                                                                                                                 Dr             To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _(Amount received on application for 70,000 shares @ 5 per share including premium) Jan 16 Equity Share Application A/c                                                                                                     Dr                  To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                  To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                  To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                  To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Transfer of application money to share capital securities premium, money refunded for 8,000) shares for rejected application and balance adjusted towards amount due on allotment as shares were allotted on Pro-rata basis) Jan 31 _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr                 To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Amount due on allotment @ Rs.4 per share) Feb 20 _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                                                                                              Dr                   To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Balance amount received on allotment) April 01 _ _ _ _ _ _ _ _ _                                                                                                                        Dr                 To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _(First and Final Call money due) April 20 _ _ _ _ _ _ _ _ _ _                                                                                                                     DrCalls – in – arrears A/c                                                                                                               Dr              To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(Money received on First and Final Call) 1,500 Aug 27 _ _ _ _ _ _ _ _ _                                                                                                                        Dr               To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _               To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _(Forfeited the shares on which call money was not received) Oct 3 _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr_ _ _ _ _ _ _ _ _ _                                                                                                                     Dr               To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _(Re-issued the forfeited shares @ 8 per share fully paid - up) _ _ _ _ _ _ _ _ _ _ _ _ _ __                                                                                                                      Dr              To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _(_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ __ )
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