Question

Kayafab Ltd. issued 1,00,000 equity shares of Rs. 10 each payable as Rs. 2 on application; Rs. 4 on allotment and Rs. 2 each on first and final call. Applications were received for 1,50,000 shares. Applicants of 50,000 shares were sent letters of regret and application money was refunded Madhur, a holder of 3,000 shares failed to pay allotment money which he paid along with the first call. Rohan, a shareholder holding 700 shares paid both the calls along with allotment. Sohan, a holder of 1,000 shares did not pay the first call and the final call. His shares were forfeited. The forfeited shares were reissued at Rs. 11 per share as fully paid-up.
Pass necessary journal entries for the above transactions in the books of the company.​

Answer 1

Explanation:

Money received in Share application account - 4,50,000 (1,50,000 X 3)

Less: Money for share allotment - 3,00,000 (100000 X 3)

Less: money for shares rejected - 60,000 (20000 X 3)

__________

Excess money available 90,000

The amount of excess application money available for adjustment against allotment is Rs.90,000.