Question

Pass entries for forfeiture and re-issue in the following case.

Ratan Ltd. forfeited 3,000 shares of ₹ 10 each (issued at ₹ 2 premium) for non-payment of first call of ₹ 2 per share. Final call of ₹ 3 per share was not yet made. Out of these 2,000 shares were re-issued at ₹ 10 per share as fully paid.

Answer 1

Books of Ratan Ltd. Journal Entries
Date	Particular	L.F.	Debit (₹)	Credit (₹)
1.	Share Capital A/c    ...Dr.		21,000
	To Share Forfeited A/c			15,000
	To Calls in Arrears A/c			6,000
	(3,000 shares forfeited for non-payment of first call money)
2.	Bank A/c    ...Dr.		20,000
	To Share Capital A/c			20,000
	(2,000 shares re-issued @ ₹ 10 per share)
3.	Share Forfeited A/c    ...Dr.		10,000
	To Capital Reserve A/c			10,000
	(Gain on re-issue of forfeited shares transferred to capital reserve)