16. A Company forfeited Rs 100 Equity Shares of 100 each issued at a premium of 50% (to be
paid at the time of allotment) on which first call money of Rs. 30 per equity share was not
received, final call of Rs. 20 is yet to be made. These equity shares were subsequently
reissued at Rs. 70 per share at Rs. 80 paid-up.
ording forfoibread reissue of creo
Answers
Answered by
1
Journal entry in the books of A Company
Explanation:-
1)Share Capital A/c. Dr. 8,000
To Share Forfeiture A/c 5,000
To share first call A/c 3,000
2) Bank A/c Dr. 7,000
Share Forfeiture A/c Dr. 1,000
To Share capital A/c 8,000
3) Share Forfeiture A/c Dr.4,000
To Capital Reserve A/c 4,000
Premium will not be dealt with in this case because premium amount was to be credited in Securities Premium Reserve on the time of allotment and we did receive it on allotment without failure.
If we hadn't received the premium amount then securities premium reserve would have to be debited in the share forfeiture entry.
Similar questions