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Standard XII

Accountancy

Forfeiture of Shares-Issued at Par

XYZ Ltd. issu...

Question

XYZ Ltd. issued 10,000 equity share of 100 each payable as follows: Rs. 20 on the application, Rs. 20 on the allotment, Rs. 30 on first call and Rs. 30 on the second and final call. 10,000 shares were applied and allotted. Mr. A holding 100 shares couldn't pay both calls. The shares are forfeited. By what amount the Share Forfeiture A/c be credited?

Rs. 6000

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Rs. 5000

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Rs. 4000

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Rs. 3000

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Solution

The correct option is C
Rs. 4000

The Share Forfeiture A/c be credited with

= 100* (20+20)

= 100*40

= Rs. 4,000

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Similar questions

XYZ Ltd. issued 10,000 equity share of 100 each payable as follows: Rs. 20 on the application, Rs. 20 on the allotment, Rs. 30 on first call and Rs. 30 on the second and final call. 10,000 shares were applied and allotted. Mr. A holding 100 shares couldn't pay both calls. The shares are forfeited. What is the total amount balance in Calls in Arrear A/c?

PRACTICAL PROBLEMS

(Forfeiture of shares issued at par)

Vijay Ltd. issued Rs 40,000 Equity shares of Rs 10 each payable as follows.

On Application	:	Rs 2	On Allotment	:	Rs 3
On First Call	:	Rs 3	On Second Call	:	Rs 2

The company received applications for Rs 50,000 equity shares. Allotment for shares was made on pro rata basis. Share allotment and calls were made and as also received except Raja holding Rs 1,000 shares failed to pay both the calls. His shares were forfeited after second call.

Record the above transactions in books of Vijay Ltd.

Note: Excess money received on share application 10,000 × Rs 2 = 20,000 will be diverted to share allotment A/c.

PRACTICAL PROBLEMS

(Under Subscription)

Usha Co. Ltd. issued Rs 12,000 Equity shares of Rs 100 each payable as under-

Rs 30 on application	Rs 20 on allotment
Rs 35 on first call	Rs 15 on second call

Public applied for Rs 10,000 shares and all the applicants were accepted by the company. Allotment of the shares were made. All the money on allotment, first call and second call were received.

Show the journal of the Company.

Q. A company makes an issue of

10, 000

equity shares of Rs.

100

each, payable as follows:
On application and allotment Rs.

50

On first call Rs.

25

On second and final call Rs.

25

members holding

400

shares did not pay the second call and the shares were dully forfeited

300

of which are reissued as fully paid at Rs.

80

per share. Amount transferred to Capital reserve will be _______.

XYZ Ltd. forfeited 500 equity shares of Rs. 100 each issued at a premium of 10%, fully called-up. The amount payable on shares is: on application Rs. 20, On allotment Rs.40 (including premium), On first and Final call Rs. 50. The company has called till the allotment stage. And these shareholders have only paid till application. The journal entry on forfeiture will be:

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The correct option is C Rs. 4000 The Share Forfeiture A/c be credited with = 100* (20+20) = 100*40 = Rs. 4,000

The correct option is C
Rs. 4000

The Share Forfeiture A/c be credited with

= 100* (20+20)

= 100*40

= Rs. 4,000