Question

On 1st April, 2016, XYZ Ltd. was formed with an authorized capital of Rs. 25,00,000 divided into 2,50,000 equity shares of Rs. 10 each. Out of these, the company issued 1,00,000 equity shares of Rs. 10 each at a premium of 10%. The amount was payable as follows :

On Application Rs. 4 (including premium)

On Allotment Rs. 4

On Final Call Rs. 3

The public applied for 90,000 equity shares and all the money was duly received. How will you show the 'Shares Capital' in the Balance Sheet of the company ? Also prepare 'Notes to Accounts' for the same.

Answer 1

EXTRACT OF BALANCE SHEET OF XYZ LTD.
As at 31st March,2017
$\begin{array}{cccc}\text{Particulars}& \text{Note}& \text{Amount}& \text{Amount}\\ & \text{No.}& \text{current}& \text{previous}\\ & & \text{year}& \text{year}\\ & & \text{Rs.}& \text{Rs.}\\ \text{1. EQUITY AND LIABILITIES :}& & & \\ \text{1. Shareholder's Funds :}& & & \\ \text{(a) Share Capital}& 1& 9,00,000& \end{array}$

Notes to Accounts :

$\begin{array}{cc}\text{Particulars}& \text{Rs.}\\ \text{(1) Share Capital :}& \\ \text{Authorised Capital :}& \\ \text{2,50,000 Equity Shares of Rs. 10 each}& \underset{–}{25,00,000}\\ \text{Issued Capital :}& \\ \text{1,00,000 Equity Shares of Rs. 10 each}& \underset{–}{10,00,000}\\ \text{Subscribed}\&\text{Fully Paid:}& \\ \text{90,000 Equity Shares of Rs. 10 each}& \underset{–}{9,00,000}\end{array}$