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Question

Satrun Ltd. was registered with an authorized capital of Rs.12,00,000, divided into 1,20,000 equity shares of Rs.10 each. It issued 40,000 equity shares to the public at premium ofRs.5 per share, payable as follows:
On application Rs.6
On allotment Rs.9 (including premium of Rs.5)
All the shares were applied for and allotted. One shareholder holding 500 shared did not pay the allotment money and his shares were forfeited. Out of the forfeited shares, the company reissued 400 shares at Rs.7 per share fully called up.
You are required to :
(a) Pass journal entries on the book of the company.
(b) Prepare
(i) Securities Premium Reserve Account.
(ii) Share Capital Account

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Solution


Journal is a book prepared by company to record every transaction that hass taken place.
Banka/cDrRs2,40,000Toshareapplicationa/cRs2,40,000

Shareapplicationa/cDrRs2,40,000Tosharecapitala/cRs2,40,000

Shareallotmenta/cDr.Rs3,60,000Tosharecapitala/cRs1,60,000Tosecuritypremiuma/cRs2,00,00

Banka/cDrRs3,58,000Callsinarreara/cDrRs4500Toshareallotmenta/cRs3,15,000

Securitypremiuma/cDrRs2500ShareCapitala/cDrRs5000Toshareforfeiturea/cRs3000Tocallsinarreara/cRs4500

Banka/cDrRs2800ShareForfeiturea/cDrRs1200ToSharecapitala/cDrRs4000

ShareForfeiturea/cDrRs1200Tocapitalreservea/cRs1200
Share capital a/c
Particulars (Dr.) Amount Particulars (Cr.) Amount
To share forfeiture a/c

To call-in-arrear a/c

To balance c/d

4,000
5,000
3,91,000
By share application a/c
By share allotment a/c
2,40,000
1,60,000
Security premium reserve a/c
Particulars (Dr.) AmountParticulars (Cr.) Amount
By calls-in-arrear a/c
To balance c/d
2,500
1,97,500
By share allotment a/c2,00,000


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Q.

R.K.Ltd., invited applications for issuing 80,000 equity shares of Rs 10 each at a premium of Rs 35 per share. The amount was payable as follows:
On Application Rs 8 (including Rs 5 premium) per share.
On Allotment Rs 12 (including Rs 10 premium) per share.

On First and Final Call Balance.

Application for 75,000 shares were received and allotment was made to all the applicants. Rahim, a shareholder who was allotted 3,000 shares failed to pay allotment money and his shares were immediately forfeited. Afterwards, the first and final call was made. Suhani who held 3,000 shares failed to pay the final call. Her shares were also forfeited. All the forfeited shares were re-issued for a sum of Rs 62,000 as fully paid up.

Pass the necessary Journal entries for the above transactions in the books of R.K.Ltd.

OR

Sargam Ltd., invited applications for issuing 80,000 equity shares of Rs 100 each at a premium. The amount was payable as follows :

On Application Rs 20 per share.

On Allotment Rs 60 (including premium) per share.

On First and Final Call Rs 40 per share.

Application for 1,20,000 shares were received. Allotment was made on pro-rata basis to all the applicants. Excess money received on applications was adjusted on sums due to allotment. Sitaram, who had applied for 6,000 shares failed to pay the allotment money and Harnam did not pay first and final call on 800 shares allotted to him. The shares of Sitaram and Harnam were forfeited. 4,200 of these shares were re-issued for Rs 100 per share as fully paid up. The re-issued shares included all the forfeited shares of Harnam.

Pass necessary Journal entries for the above transactions in the books of Sargam Ltd.

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