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Question

Pawan Ltd. was registered with an authorised Capital of Rs 5,00,000 divided into shares of Rs 10 each. It purchased a Building from Y for Rs 2,00,000 and issued fully paid shares to Y for purchases consideration.It invited applications for the balance 30,000 shares payable as under:---- Rs 3 per share on Application; Rs 3 per share on Allotment; Rs 2 per share First Call; and Rs 2 on Final Call.

Ashok, who had been allotted 500 shares failed to pay both the Calls. His shares were forfeited and re-issued at Rs 9 per share to Hari, as fully paid up. Make neccessary entries in the Journal of the Company.


Solution

                                                                    JOURNAL                                     

Date             ParticularsL.FDr (Rs)Cr. (Rs)Buildings A/cDr.2,00,000   To Vendors (Y)2,00,000(Assets purchased)Vendors (Y)Dr.2,00,000   To Share Capital A/c2,00,000(Purchase consideration discharged by shares)Bank A/cDr.90,000   To Share Application A/c90,000(Amount received on application)Share Application A/cDr.90,000   To Share Capital A/c90,000(Amount of share application transferred to share capital a/c)Bank A/cDr.90,000   Share Allotment A/c90,000(Amount received on allotment)Share Allotment A/cDr.90,000   To Share Capital A/c90,000(Allotment money transfer to share capital account)Bank A/cDr.59,000   To Share First Call A/c59,000(Amount received on first call on 29,500 shares @ Rs 2 per share)Share First Call A/cDr.60,000   To Share Capital A/c60,000(First call money transferred to share capital account)Bank A/cDr.59,000   To Share Final Call A/c59,000(Amount received on first call on 29,500 shares @ Rs 2 per share)Share Final Call A/cDr.60,000   To Share Capital A/c60,000(Final call money transferred to share capital account)Share Capital A/cDr.   5,000   To Share First Call A/c   1,000   To Share Final Call A/c   1,000   To Share Forefeiture A/c   3,000(500 shares of Ashok forfeited for non-payment of FirstCall and Final Call)Bank A/cDr.   4,500Share Forefeiture A/cDr.    500   To Share Capital A/c   5,000(Re-issue of 500 shares @ Rs 9 per share)Share Forefeiture A/c   2,500   To Capital Reserve A/cDr.   2,500(Balance left in Share Forefeiture A/c Rs  3,000 - Rs  500=Rs 2,500 transferred to Capital Reserve A/c)


Accountancy

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