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Calls in Advance

Kisan Co. Ltd...

Question

Kisan Co. Ltd. Miraj, issued Rs. 50,000 shares at par Rs. 10 each, payable Rs. 3 on application, Rs. 4 on allotment that the balance on the final call. All the shares were fully subscribed and paid except a shareholder Mr. D. Kapse having Rs. 1,000 shares could not pay the final call. Mr. D. Kapse paid the call-in-arrear amount together with interest after four months of due date of final call. Company charged interest on the arrears as per table 'A'.
Pass Journal entries to record these transaction assuming that call-in-arrear and interest money received from Mr. D. Kapse in the books of Kisan Co. Ldt. Miraj.

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Solution

In the books of Kisan Co. Ldt. Miraj

Date

Particulars

Amount (Dr.)

Amount (Cr.)

1.

Bank A/c

Dr.

150000

To Share application A/c

150000

(Being shares application money @ Rs. 3 per share received for 50000 shares)

2.

Share application A/c

Dr.

150000

To Share Capital A/c

150000

(Being application money on 50000 shares transferred to share capital A/c)

3.

Share Allotment A/c

Dr.

200000

To Share Capital A/c

200000

(Being share allotment due)

4.

Bank A/c

Dr.

200000

To Share Allotment A/c

200000

(Being allotment money received)

5.

Share First Call A/c

Dr.

150000

To Share Capital A/c

150000

(Being share first call due)

6.

Bank A/c

Dr.

147000

Calls-in arrears A/c

Dr.

3000

To Share first call A/c

147000

(Being first call money received except for 100 shares)

7.

Bank A/c

Dr.

3060

To calls-in-arrears A/c

3000

To interest

3060

(Being calls in arrear received along with interest)

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On Application Rs 2; on allotment Rs 1; on first call Rs 3 and on final call Rs 4 per share (four months after first call).

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Final call was made. All the shareholders paid in full. First call arrear on 1,000 shares were also received at the time of final call.

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equity shares of

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On Application

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On Allotment

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R s . 3

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R s . 5

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Pass necessary Journal Entries for the above transactions in the books of the company.

X Ltd., invited applicaions for issuing 50,000 equity shares fo Rs 10 each. The amount was payable as follows : On Application : Rs 2 per share, On Allotment : Rs 3 per share, On First Call Rs 3 per share, On Second and Final Call : Balance amount. Applications for 70,000 shares were received. Applications for 10,000 shares were rejected and the application money was refunded. Shares were allotted to the remaining applicants on pro-rata basis and excess money received with applications was transferred towards sums due on allotment and calls, if any. Gopal,who applied for 600 shares, paid his entire share money with application. Ghosh, who had applied for 6,000 shares, failed to pay the allotment money and his shares were immediately forfeited. These forfeited shares were re-issued to Sultan for Rs 20,000; Rs 4 per share paid up. The first call money and the second and final call money was called and duly received. Pass necessary Journal entries for the above transactions in the books of X Ltd. Open Calls-in -Advance Account and Calls-in-Arrears Account wherever necessary.

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Rishabh, a shareholder, who applied for 1,500 shares and belonged to category (ii), did not pay allotment, first and second and final call money. Another shareolder, Sudha, who applied for 1,800 shares and belonged to category (i), did not pay the first and second and final call money. All the shares of Rishabh and Sudha were forfeited and were subsequently re-issued at Rs 7 per share fully paid. Pass the necessary Journal entries in the books of A Ltd. Open Call-in Arrears account and Call-in -Advance Account wherever required.

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Date	Particulars		Amount (Dr.)	Amount (Cr.)
1.	Bank A/c	Dr.	150000
	To Share application A/c			150000
	(Being shares application money @ Rs. 3 per share received for 50000 shares)
2.	Share application A/c	Dr.	150000
	To Share Capital A/c			150000
	(Being application money on 50000 shares transferred to share capital A/c)
3.	Share Allotment A/c	Dr.	200000
	To Share Capital A/c			200000
	(Being share allotment due)
4.	Bank A/c	Dr.	200000
	To Share Allotment A/c			200000
	(Being allotment money received)
5.	Share First Call A/c	Dr.	150000
	To Share Capital A/c			150000
	(Being share first call due)
6.	Bank A/c	Dr.	147000
	Calls-in arrears A/c	Dr.	3000
	To Share first call A/c			147000
	(Being first call money received except for 100 shares)
7.	Bank A/c	Dr.	3060
	To calls-in-arrears A/c			3000
	To interest			3060
	(Being calls in arrear received along with interest)