Maharashtra State BoardHSC Arts 12th Board Exam
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Record the Above Transactions in the Journal of the Company. - Book Keeping and Accountancy

Journal Entry

(Issue at premium and calls in arrears)
Hindusthan Petroleum Ltd., invited application for 40,000 Equity shares of Rs 100 each payable as under including 20% premium:

On Application Rs 30 On Allotment Rs 40 (including premium)
On First Call Rs 20 On Final Call Rs 30
 

All the shares were applied for and also allotted. One share holder who was allotted 500 shares failed to pay first and final call.
Record the above transactions in the journal of the company.

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Solution

                           Books of Hindusthan Petroleum Ltd.
                                          Journal Entry

Date Particulars L.F. Debit Amount (Rs.) Credit Amount (Rs.)
  Bank A/c                                    Dr.
   To Equity Share Application A/c
(Share application received on 40,000 shares of Rs.30 each)
  12,00,000 12,00,000
  Equity Share Application A/c          Dr.
   To Equity Share Capital A/c
(Share application transferred to share allotment)
  12,00,000 12,00,000
  Equity Share Allotment A/c    Dr.
   To Equity Share Capital A/c
   To Securities Premium A/c
[Share allotment due on 40,000 shares of Rs 40 each (including Premium of 20%)]
  16,00,000 8,00,000
8,00,000
  Bank A/c                                 Dr.
   To Equity Share Allotment
(Share application received)
  16,00,000 16,00,000
 

Equity Share First Call A/c       Dr.
   To Equity Share Capital A/c
(Share first call due on 40,000 shares of Rs 20 each)

  8,00,000 8,00,000
  Bank A/c                             Dr.
Calls-in-Arrears A/c            Dr.
   To Equity Share First Call A/c
(Share first call received on 39,500 shares of Rs 20 each)
  790,000
10,000
800,000
 

Equity Share Final Call A/c Dr.
  To Equity Share Capital A/c
(Share Final call due on 40,000
shares of Rs.30 each)

  12,00,000 12,00,000
  Bank A/c                                 Dr.
Calls-in-Arrears 
    To Equity Share Final Call A/c
(Share first call received on 39,500 shares of Rs 30 each)
  11,85,000
15,000
12,00,000

Working Notes:
Calls-in-Arrears on First Call = 500 x 20 = Rs. 10,000
Calls-in-Arrears on Final Call = 500 x 30 = Rs. 15,000

Concept: Issue at Par and Premium and at Discount
  Is there an error in this question or solution?
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APPEARS IN

Micheal Vaz Accounts - Book Keeping and Accountancy HSC 12th Standard Maharashtra State Board
Chapter 10 Company Accounts Part - 1 (Accounting for Shares)
Exercise | Q 8 | Page 353
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