Maharashtra State BoardHSC Commerce 12th Board Exam
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Pass Journal Entries and Show the Balance Sheet. - Book Keeping and Accountancy

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Journal Entry

(Call in arrears and Balance Sheet)
The Alfo Ltd. made an issue of 10,000 shares of Rs 20 each payable as follows-

Application Rs 5 Allotment Rs 10
First Call Rs 2 Final Call Rs 3

The company received applications for 15,000 shares of which applications for 5,000 shares were rejected and money refunded. The directors made all the calls. One share holders, holding 100 shares failed to pay first and final call. The expenses of issue amounted to Rs 5,000 . Pass journal entries and show the Balance Sheet.
Note: Expenses on issue should be shown as asset. Every year certain amount of expenses should be charged to P&L A/c.

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Share Applied Share Allotted
15,000 10,000

                                          Journal Entry

Date Particulars L.F. Debit Amount (Rs.) Credit Amount (Rs.)
  Bank A/c                                Dr.
   To Share Application A/c
(Share application received on 15,000 shares of Rs 5 each)
  75,000 75,000
  Share Application A/c            Dr.
  To Share Capital A/c
   To Bank A/c
(Share application transferred to Share Capital A/c and Share Application on 5,000 shares has been refunded)
  75,000 50,000
  Share Allotment A/c              Dr.
    To Share Capital A/c
(Share allotment due on 10,000 shares of Rs. 10 each)
  100,000 100,000
  Bank A/c                                Dr.
  To Share Allotment A/c
(Share allotment received)
  100,000 100,000

Share First Call A/c                Dr.
     To Share Capital A/c
(Share first call due on 10,000 shares of Rs 2 each)

  20,000 20,000
  Bank A/c                               Dr.
Call-in-Arrears A/c                Dr.
       To Share First Call A/c
(Share first call received on 9,800 shares of Rs. 3 each)
  30,000 30,000
  Bank A/c                                Dr.
Calls-in-Arrears A/c               Dr.
    To Share Final Call A/c
(Share final call received on 9,700 shares of Rs. 3 each)
  Share Issue expenses A/c       Dr.
   To Bank A/c
(Expenses on issue of shares paid)
  5,000 5,000

                                 Balance Sheet of Alfo Ltd.

Liabilities   Amount (Rs.) Assets Amount (Rs.)
Issued and Paid-up Capital 10,000 shares of Rs. 20 each


199,500 Cash at Bank
Miscellaneous Expenditure
(-) Calls-in-Arrears 500 Expenses on Issue 5,000
    199,500   199,500
Concept: Calls in Advance and Arrears
  Is there an error in this question or solution?


Micheal Vaz Accounts - Book Keeping and Accountancy HSC 12th Standard Maharashtra State Board
Chapter 10 Company Accounts Part - 1 (Accounting for Shares)
Exercise | Q 6 | Page 353
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