Question

U.P. Sugar Works Ltd. was registered on 1st January, 2019 with an authorised capital of ₹ 15,00,000 divided into 15,000 shares of ₹ 100 each. The company issued on 1st April, 2019, 5,000 shares of ₹ 100 each at a premium of ₹ 5 per share payable ₹ 25 per share on application , ₹ 30 (including premium) on allotment and the balance in two equal installments of ₹ 25 each on 1st July and 1st October respectively. All the allotments and call moneys were paid when due, except in case of one shareholder who failed to pay the final call on 100 shares held by him. His shares were forfeited on 1st November after giving him a due notice. Show necessary entries in the books of the company to record these transactions.

Answer 1

Authorised capital 15,000 shares of 100 each

Issued and applied capital 5,000 shares of ₹ 100 each at a premium ₹ 5

Application	=	₹ 25
Allotment	=	₹ 30	(25+5)
First Call	=	₹ 25
Final Call	=	₹ 25
		105	(100+5)

Books of U.P. Sugar Works Limited
Journal

Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount (₹)
2019
Apr. 01	Bank A/c	Dr.		1,25,000
	To Share Application A/c				1,25,000
	(Share application money received for 5,000 shares at ₹ 25 each)
Apr. 01	Share Application A/c	Dr.		1,25,000
	To Share Capital A/c				1,25,000
	(Share application money transferred to Share Capital)
Apr. 01	Share Allotment A/c	Dr.		1,50,000
	To Share Capital A/c				1,25,000
	To Securities Premium A/c				25,000
	(Share allotment due on 5,000 shares at ₹ 30 each including ₹ 5 premium)
	Bank A/c	Dr.		1,50,000
	To Share Allotment				1,50,000
	(Share allotment money received)
Jul. 01	Share First Call A/c	Dr.		1,25,000
	To Share Capital A/c				1,25,000
	(Share first call due on 5,000 shares at ₹ 25 each)
	Bank A/c	Dr.		1,25,000
	To Share First Call A/c				1,25,000
	(Share first call money received)
Oct 01	Share Final Call A/c	Dr.		1,25,000
	To Share Capital A/c				1,25,000
	(Share final call due on 5,000 shares at ₹ 25 each)
	Bank A/c	Dr.		1,22,500
	Calls-in-Arrear A/c	Dr.		2,500
	To Share Final Call A/c				1,25,000
	(Share final call ₹ 25 each received for 4,900 shares and a holder of 100 share failed to pay it)
Nov. 01	Share Capital A/c (100 × 100)	Dr.		10,000
	To Share Forfeiture A/c (100 × 75)				7,500
	To Calls-in-Arrear A/c (100 × 25)				2,500
	(100 shares forfeited for the non-payment of final call)