Question

Shiva Limited invited applications for issuing 200000 equity shares of rupees 100 each at the premium of Rs 60 Persia the amount was payable as follows on application rupees 30 persons including premium rupees 10 on allotment rupees 74 share including premium rupees 50 on first and final call the balance amount applications for 190000 shares were received shares allotted to all the applicants and the company received all money due on allotment accept and who had been allotted 1000 share and his shares were immediately for fitted afterwards first and final call was made Gupta did not pay the first and final call on his 2000 allotted shares his shares were also forfeited 50% of the forfeited shares of both Jain and Gupta were issued for 90% of fully paid-up pass necessary journal entries in the book of Shiva Limited for the above transaction

Answer 1

Answer:

Explanation:

                                             Journal Entries                                                              

Bank A/c    Dr         57,00,000

        To Share Application A/c              57,00,000

(Share Application received for 1,90,000 equity shares)

Share Application A/c    Dr.     57,00,000

      To Equity Share Capital A/c                    38,00,000

     To Securities Premium A/c                   19,00,000

 (Share application transferred to equity share capital and securities premium)

Share Allotment A/c   Dr.      1,33,00,000

To Equity Share Capital A/c                                 38,00,000

To Securities Premium A/c                                  95,00,000

(Share allotment due)

Bank A/c    Dr.             1,32,30,000

Calls in Arrears A/c   Dr.   70,000

To Share Allotment A/c                            1,33,00,000

(Share Allotment received except 1000 shares)

 Equity Share Capital A/c     Dr.     40,000

Securities Premium A/c      Dr.      50,000

To Share Forfeiture A/c                                     20,000

To Calls in Arrears A/c                                     70,000

(1000 equity shares forfeited  for the non-payment of share allotment)

Share First and Final Call A/c    Dr.          1,13,40,000

To Equity Share Capital A/c                                                1,13,40,000

(Share first and final call due on 1,89,000 shares @ Rs 60 each)

Bank A/c    Dr.          1,12,20,000

Calls in Arrears A/c    Dr.   1,20,000

To Share First and Final Call A/c                    1,13,40,000

(Share first and final call received 1,87,000 shares and 2000 share failed)

  Equity Share Capital A/c     Dr.    2,00,000

To Share  Forfeiture A/c        80,000

To Calls in Arrears A/c                              1,20,000

(2000 shares of Rs 100 each forfeited for the non-payment of Rs 60 per share)

Bank A/c  Dr.     1,35,000

Share Forfeiture A/c    Dr.     15,000

To Equity Share Capital A/c                             1,50,000

(Of the forfeited shares half of Jain and half of Gupta’s forfeited shares re-issued at Rs 90 per shares full paid-up)

Share  Forfeiture A/c    Dr.    35000

To Capital Reserve A/c                       35,000

 (Balance of 1500 share in share forfeiture transferred to Capital Reserve)