X Ltd. company forfeited 800 shares of Rs.10 each issued at par for non-payment of 1st call Rs.2 and final call Rs.3 each. Out of these, 500 shares are re-issued at 10% discount. Give journal entries in the books of the company.
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share capital A/C... Dr. (800×10) 8000
to share forfeiture (800×5) 4000
to share first call (800×2) 1600
to share final call (800×3) 2400
bank A/C.... dr. (500×9) 4500
share forfeiture A/C...dr. (500×1) 500
to share capital A/C. (500×10) 5000
share forfeiture A/C... dr. 2000
to capital reserve A/C. 2000
forfeiture : amount
800 : 4000 --> 1:5
500 : ?
amount of 500 share = 500×5/1 = 2500
less :-> discount on reissue (500)
amount to be transferred to capital reserve = 2500 - 500 = 2000
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