sun ltd. issued shares of rs 50 each at premium of 20% payable as on application rs15 on allotmemt rs 25[including premimum] on first and final rs 20 . Dev who appled for 2500 shares and to whom 1000 shares were allotted on prorata basis did not pay allotment money and first & final call and his shares were forfeited pass entry for forfiture entry
Answers
Surplus Application money received from Dev
Shares applied for – 2,500
Shares allotted – 1,000
Surplus shares applied for = 2,500 – 1,000 = 1,500
Surplus application money received = 1,500 x 15 = 22,500
Balance not received on the allotment
Allotment money = 1,000 x 15 = 15,000
Premium on allotment = 1,000 x 10 = 10,000
Total = 25,000
Less surplus application money received 22,500
Amount not received on allotment = 25,000 – 22,500 = 2,500
Journal Entry for forfeiture of shares
Share Capital Account Dr (1000 shares x Rs. 30 called) 30,000
Securities Premium Account 2.500
To Share Forfeiture Account 30,000
To Share Allotment Account 2,500
(Being 1000 shares of Dev forfeited due to non-payment of allotment money and surplus received on application adjusted)