X Ltd., invited applications for issuing 80,000 equity shares of Rs. 10 each at a premium of Rs. 2 share. The amount was payable as follows :
On application Rs. 6 (including premium) per share.
On allotment Rs. 3 per share.
Balance of first and final call.
Applications for 90,000 shares were received. Applications for 5,000 shares were rejected and pro-rata allotment was made to the remaining applications. Over payments received on application was adjusted towards sums due on allotment. All calls were allotted to Vijay. These shares were forfeited and the forfeited shares were re-issued for Rs. 18,400 fully paid up. Pass necessary journal entries in the books of the company.
Answers
Calculation of amount unpaid on Allotment
Share Applied by Raman =
80,000
1,20,000
×400=600 shares
Excess money received =Rs800(200×4)
Amount due on Allotment =1,200(400×3)
Less. Excess Application Money
800
Amount unpaid on Allotment =400
Amount unpaid on Securities Premium =
1,200
(400×3)
Total amount unpaid on allotment =Rs.1,600
Calculation of amountt received from Raman (Share Forfeiture-Cr.)
Add: Excess Application money =
800
Share Forfeiture (Cr.) =2,000
Calculation of amount received from Veer (Share Forfeiture - Cr.)
Amount received on application =2,400(800×3)⇒ excluding premium
Amount received om allotment =2,400(800×3) excluding premium
Total amount received =Rs.4,800
Calculation of Capital Reserve
(i) 400 shares of Raman are reissued
share Forfeiture (Cr.) =2,000
Less: Share Forfeiture (Dr.)
800
(400×2)
Capital Reserve
(ii) 100 shares of Veer are reissued
Share Forfeiture (Dr.)
200
(100×2)
Capital Reserve =Rs400
Total amount of Capital Reserve Rs.1,600(1,200+400)
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