Question

A was holding 100 equity shares of Rs.100 each of B limited issued at par. He paid Rs. 20 on

application, Rs. 50 on allotment but he could not pay Rs.30 per share on call. His shares were

forfeited. Make journal entry for forfeiture of shares.​

Answer 1

Answer:

share capital A/c. ...Dr.(100×100)10,000

To shares forfeited A/c (100×70)7000

To share call A/c. (100×30)3000

(Being shares forfeited due to non-payment of call money.)

share forfeited A/c ...Dr.7,000

To Capital reserve A/c. 7,000

(Being forfeited amount transferred to capital reserve a/c)