Question

A Limited Company forfeited 100 Equity Shares of the face value of ₹ 10 each, ₹ 6 per share called-up, for non-payment of first call of ₹ 2 per share . The forfeited shares were subsequently reissued as fully paid-up @ ₹ 7 each.
Give necessary entries in the company's journal.

Answer 1

Books of A Ltd. Company Journal
Date	Particulars		L.F.	Debit Amount Rs	Credit Amount Rs
	Equity Share Capital A/c	Dr.		600
	To Share Forfeiture A/c				400
	To Calls-in-Arrears A/c				200
	(100 shares of Rs 10 each Rs 6 called up, forfeited for the non-payment of first call Rs 2 per shares)
	Bank A/c	Dr.		700
	Share Forfeiture A/c	Dr.		300
	To Share Capital A/c				1,000
	(100 shares of 10 each re-issued at Rs 7 per share, fully paid-up)
	Share Forfeiture A/c	Dr.		100
	To Capital Reserve A/c				100
	(Balance in Share Forfeiture of re-issued shares transferred to Capital Reserve)

Working Note-

Share Forfeiture Credit	Rs	400
Share Forfeiture Debit	Rs	300
Balance in Share Forfeiture of re-issued shares		100

Capital Reserve = Balance in Share Forfeiture of re-issued shares = Rs 100