Question

On 1st January 2017, New Royal Ltd. issued 2,00,000 equity shares of 10 each payable as follows:

Application 3

Allotment 2

1st Call 2 (Payable after 2 months, from allotment date)

Final Call 3 (Payable after 2 months from the date of 1st call)

The company receives applications on 15th January 2018 for 2,40,000 shares and makes allotment on 1st February 2017.

It allows applicants for 100,000 shares in full, those for 120,000 shares, 100,000 shares and rejects applications for 20,000 shares.

Balance amount due on allotment received on 15th February. The company duly makes the calls on 1st March 2017 and 1st April 2017 respectively.One shareholder did not pay the 1st call money on 6,000 shares which he paid with the final call together with interest at 5% p.a.

Another shareholder holding 2,000 shares did not pay the final call money till the end of the accounting year which ended on 31st March 2018. Show Journal Entries.​

Answer 1

Answer:

allotment on 1st February 2017.

It allows applicants for 100,000 shares in full, those for 120,000 shares, 100,000 shares and rejects applications for 20,000 shares.

Balance amount due on allotment received on

Answer 2

Answer:

company treats calls-in-advance as a debt of until it makes the calls. The amount already paid is adjusted. Calls-in-advance may also arise when the number of shares allotted to a person is much smaller than the number applied by him for and the terms of issue allow the company to retain the amount received in excess of application and allotment money.

The company can retain only such amount as is