Question 18 Chapter 8 of +2 Part-1 - USHA Publication 12 Class Part

Question 18 Chapter 8 of +2-Part-1

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The solution of Question 18 Chapter 8 of +2 Part-1: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

18. (Expenses on Issue) Hemant Textiles Ltd. having a nominal capital of Rs. 10,00,000 in shares of Rs. 100 each invited applications for 5,000 shares payable as follows :
On application Rs. 20
On allotment Rs. 25
On first call Rs. 25
On second and final call Rs. 30
All the shares were subscribed and allotment made. All the money was received except final call on 100 shares. Expenses of issue came to 10,000. They are to be written off in the same year. Pass journal entries in the books of company.

The solution of Question 18 Chapter 8 of +2 Part-1: –

Journal
Date	Particulars		L.F.	Debit	Credit
a)	Bank A/c (5,000 X 20)	Dr.		1,00,000
	To Share Application A/c				1,00,000
	(Being application money received)

b)	Share Application A/c	Dr.		1,00,000
	To Share capital A/c (5,000 X 20)				1,00,000
	(Being application money transferred to Share cap. A/c)

c)	Share Allotment A/c (5,000 X 25)	Dr.		1,25,000
	To Share capital A/c				1,25,000
	(Being allotment money due on 5,000 share @ 25 per shares)

d)	Bank A/c (5,000 X 25)	Dr.		1,25,000
	To Share allotment A/c				1,25,000
	(Being allotment money received on 5,000 share @ 25 as per shares)

e)	Share first Call A/c (5,000 X 25)	Dr.		1,25,000
	To Share capital A/c				1,25,000
	(Being first call money due on 5,000 share @ 25 per shares)

f)	Bank A/c (5,000 X 25)	Dr.		1,25,000
	To Share first Call A/c				1,25,000
	(Being first call money received on 5,000 share @ 25 per shares)

g)	Share second & final Call A/c (5,000 X 30)	Dr.		1,50,000
	To Share capital A/c				1,50,000
	(Being final call money due on 5,000 share @ 30 per shares)

h)	Bank A/c (5,000 X 30)	Dr.		1,47,000
	Calls in arrear A/c	Dr.		3,000
	To Share second & final Call A/c				1,47,000
	(Being second & final call money received on 5,000 share @ 30 per shares)

i)	Share Issue Expense A/c	Dr.		10,000
	To Bank A/c				10,000
	(Being share issue expenses paid )

j)	Profit & Loss A/c	Dr.		2,000
	To Share Issue Expense A/c				2,000
	(Being one fifth of the expenses written off )