Question

The authorised capital of ₹ 16,00,000 of Bharat Ltd. is divide into 1,60,000 Equity Shares of ₹ 10 each. Out of these shares, 80,000 Equity Shares were issued at par to public for subscription. The full nominal value is payable on application. All the shares were subscribed by the public and total amount was paid for. Pass necessary journal entries in the books of the company.

Answer 1

Authorised Capital 1,60,000 equity shares of ₹ 10 each
Issued and Subscribed Capital 80,000 equity shares

Books of Bharat Limited
Journal 

Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount  (₹)
	Bank A/c              Dr.			8,00,000
	To Equity Share Application A/c				8,00,000
	(Share application money received for 80,000 Equity Shares of ₹ 10 each)
	Equity Share Application A/c     Dr.			8,00,000
	To Equity Share Capital A/c				8,00,000
	(Share application of 80,000 shares of ₹ 10 each transferred to Equity Share Capital Accounts)