Question

A limited company issued a prospectus inviting applications for 2,00,000 shares of 10 each at a premium of 2
per share payable as follows: On Application 3; On Allotment 4 (including premium): On First Call 3 and
On Second Call 2.
Applications were received for 3,00,000 shares and allotment was made on pro-rata basis. Money overpaid on
applications was employed on account of sums due on allotment.
R, to whom 400 shares were allotted failed to pay the allotment money and on his subsequent failure to pay the
First Call his shares were forfeited. M, the holder of 600 shares failed to pay the two calls and his shares were
forfeited after the Second Call. Of the shares forfeited, 800 shares were sold to K as fully paid, K paying 39 per
share, the whole of R's share being included.
Give journal entries, prepare Bank Account and show how the Share Capital will be shown in the Company
Balance Sheet.
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Answer 1

Answer:

2000 shares allotted to the applicants of 2400 shares.

If share allotted 2000 shares applied were:- 2400

If shares allotted 40 shares applied were:- 2400/2000* 40

Hope it's helpful dear

Answer 2

40 is the answer of this questionFirst Call his shares were forfeited. M, the holder of 600 shares failed to pay the two calls and his shares were

forfeited after the Second Call. Of the shares forfeited, 800 shares were sold to K as fully paid, K paying 39 per

share, the whole of R's share being included.

Give journal entries, prepare Bank Account and show how the Share Capital will be shown in the Company

Balance Sheet.