Question

16.
Vinod Ltd. forfeited 5,000 shares of Rs.10 each, fully called-up, on which they had received
only Rs.35,000. Out of the forfeited shares 125 were reissued for Rs.9 per share fully paid
up. Fill the following missing figures:
Date Particulars
L.F. Debit Credit
Share Capital A/C
Dr.
?
To Share Forfeiture A/c
?
To Calls in Arrears A/C
?
(Being 5,000 shares forfeited for non-payment
of Rs.15,000)
Dr.
Bank A/C
Dr.
Share Forfeiture A/c
To Share Capital A/C
(Being 125 forfeited shares reissued)
Share Forfeiture A/C
Dr.
To Capital Reserve
(Being gain on reissue of shares)
forfeited share reissued)​

Answer 1

Journal Entry in the Books of Vinod Limited

Explanation:

1) Call in arrears is credited for the amount of 15,000 because it is the amount not received to us. And Share Forfeiture is credited with 35,000 because this amount has already been received on these shares.

2) Bank is debited with 1,125 because for re-issued 125 shares @9 per share has been received.

Share forfeiture is debited with 125 as(125 shares @ ₹1 per share) which is the difference between the original share price and the re-issued price.

3) The balance of Share Forfeiture A/c (35,000-125) is transferred to Capital Reserve.