Question

A Co Ltd. was registered with a nominal capital of ₹ 1,00,000 in Equity Shares of ₹ 10 each. It offered to the public 6,000 shares for subscription . The applications were received for 8,000 shares. The Directors rejected applications for 1,000 shares and returned the money received thereon. The application money received on the other 1,000 shares was adjusted towards allotment money. The amount payable on shares was: ₹ 2 per share on application, ₹ 4 per share on allotment and the balance on first call . One shareholders holding 100 shares failed to pay the first call money and as a result his shares were forfeited .
Pass necessary journal entries and prepare Cash Book to record the above transactions.

Answer 1

Authorised Capital 10,000 equity shares of Rs 10 each

Issued Capital 6,000 shares

Applied Capital 8,000 shares

Allotment made as:				Payable as:
Applied		Alloted		Application	Rs	2	per share
7,000		6,000		Allotment	Rs	4	per share
1,000		NIL		First and Final Call	Rs	4	per share
8,000		6,000				10	per share

	Cash Book
Dr.					Cr.
Date	Particulars	Bank Rs	Date	Particulars	Bank Rs
	Equity Share Application	16,000		Equity Share Application	2,000
	Equity Share Allotment	22,000
	Equity Share First and Final Call	23,600		Balance c/d	59,600
		61,600			61,600

Journal
Date	Particulars			L.F.	Debit Amount Rs	Credit Amount Rs
	Equity Share Application A/c	Dr.			14,000
	To Equity Share Capital A/c					12,000
	To Equity Share Allotment A/c					2,000
	(Share application money of 6,000 shares at Rs 2 each transferred to Share Capital and Rs 2,000 adjusted towards allotment)
	Equity Share Allotment A/c	Dr.			24,000
	To Equity Share Capital A/c					24,000
	(Share allotment money due on 6,000 shares at Rs 4 each)
	Equity Share First and Final Call A/c		Dr.		24,000
	To Equity Share Capital A/c					24,000
	(Share First and Final Call due on 6,000 shares at Rs 4 each)
	Calls-in-Arrears A/c		Dr.		400
	To Equity First and Final Call A/c					400
	(A holder of 100 shares failed to pay First and Final Call money and amount due from him transferred to Calls-in-Arrears Account)
	Equity Share Capital A/c		Dr.		1,000
	To Share Forfeiture A/c					600
	To Calls-in-Arrears A/c					400
	(100 shares of Rs 10 each forfeited for the non-payment of first and final call Rs 4 per share)