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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Tiny Toys Ltd. issued 10,000 shares of ₹100 each at a premium of ₹20, payable: ₹10 per share on application; ₹40 per share plus ₹10 premium on allotment; and ₹50 per share plus ₹10 premium on final call. Excess application money was to be adjusted first towards the amount due on allotment, with any further excess returned. Applications were received for 13,000 shares in total. Applicants for 11,000 shares were allotted only 10,000 shares, and applicants for 2,000 shares were sent letters of regret. All money due on allotment and final call was duly received. Pass the necessary entries, and prepare the company’s Balance Sheet.
JOURNAL (Books of Tiny Toys Ltd.)
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| Bank A/c (13,000 × ₹10) Dr. | 1,30,000 | |||
| To Share Application A/c | 1,30,000 | |||
| (Application money received on 13,000 shares) | ||||
| Share Application A/c Dr. | 1,30,000 | |||
| To Share Capital A/c (10,000 × ₹10) | 1,00,000 | |||
| To Share Allotment A/c | 10,000 | |||
| To Bank A/c (2,000 × ₹10) | 20,000 | |||
| (Application money for 10,000 shares transferred to Share Capital; the ₹10,000 excess from the 11,000-share group adjusted against Allotment; the 2,000 rejected applications refunded) | ||||
| Share Allotment A/c Dr. | 5,00,000 | |||
| To Share Capital A/c (10,000 × ₹40) | 4,00,000 | |||
| To Securities Premium A/c (10,000 × ₹10) | 1,00,000 | |||
| (Allotment due on 10,000 shares @ ₹50, including ₹10 premium) | ||||
| Bank A/c Dr. | 4,90,000 | |||
| To Share Allotment A/c | 4,90,000 | |||
| (Allotment money received, net of the ₹10,000 already adjusted) | ||||
| Share Final Call A/c (10,000 × ₹60) Dr. | 6,00,000 | |||
| To Share Capital A/c (10,000 × ₹50) | 5,00,000 | |||
| To Securities Premium A/c (10,000 × ₹10) | 1,00,000 | |||
| Bank A/c Dr. | 6,00,000 | |||
| To Share Final Call A/c | 6,00,000 |
BALANCE SHEET OF TINY TOYS LTD. (Extract)
| Particulars | Note No. | ₹ |
|---|---|---|
| 1. Shareholders’ Funds: Share Capital | 1 | 10,00,000 |
| Reserves and Surplus | 2 | 2,00,000 |
| Total | 12,00,000 | |
| 2. Current Assets: Cash and Cash Equivalents | 3 | 12,00,000 |
NOTES TO ACCOUNTS
| Particulars | ₹ |
|---|---|
| 1. Share Capital | |
| Issued and Subscribed, Called-up and Paid-up: 10,000 shares of ₹100 each | 10,00,000 |
| 2. Reserves and Surplus | |
| Securities Premium Reserve | 2,00,000 |
| 3. Cash and Cash Equivalents | |
| Cash at Bank | 12,00,000 |
Note: A total of 13,000 shares’ worth of applications were received against the 10,000 shares issued, an oversubscription of 3,000 shares.
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "T.S. Grewal Class 12 Vol 2 Chapter 1 Q.23 - Share Capital", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 1 - Share Capital.
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