Question 19 A Chapter 8 of +2-Part-1
19A. (Calls in Arrear and Calls in Advance) A Ltd. issued 20,0000 equity shares of Rs. 10 each at a premium of 10% payable Rs. 2 on Application, Rs. 4 on Allotment (Including premium); Rs. 3 on first call and Rs. 2 on Final call . All the shares were duly subscribed, allotted and both the calls were made.
A holder of 400 shares did not pay final call while another holder of 500 shares paid the entire sum due on allotment.
Pass journal entries and prepare Balance Sheet.
The solution of Question 19 A Chapter 8 of +2 Part-1: –
| Journal |
|||||
| Date | Particulars |
L.F. | Debit | Credit | |
| a) | Bank A/c | Dr. | 40,000 | ||
| To Equity Share application A/c | 40,000 | ||||
| (Being application money received on 20,000 shares @ Rs. 2 per share) | |||||
| b) | Equity Share Application A/c | Dr. | 40,000 | ||
| To Equity Share capital A/c | 40,000 | ||||
| (Being application money transferred to Share cap. A/c) | |||||
| c) | Equity Share Allotment A/c | Dr. | 80,000 | ||
| To Equity Share capital A/c | 60,000 | ||||
| To Securities premium reserve A/c | 20,000 | ||||
| (Being allotment money due on 1,25,000 share @ Rs.7 as per shares) | |||||
| d) | Bank A/c | Dr. | 82,500 | ||
| To Equity Share allotment A/c | 80,000 | ||||
| To Calls in advance A/c | 2,500 | ||||
| (Being allotment money received along with calls in advance on 500 share @ Rs.5 each ) | |||||
| e) | Equity Share first Call A/c | Dr. | 60,000 | ||
| To Equity Share capital A/c | 60,000 | ||||
| (Being first call money due on 20,000 shares @ 3 per share & call in advance on shares adjusted) | |||||
| f) | Bank A/c | Dr. | 58,500 | ||
| Calls in advance A/c | Dr. | 1,500 | |||
| To Share First Call A/c | 60,000 | ||||
| (Being first call money received on 19,500 shares & call in advance on 500 shares adjusted ) | |||||
| g) | Equity Share final Call A/c | Dr. | 40,000 | ||
| To Equity Share capital A/c | 40,000 | ||||
| (Being final call money due) | |||||
| h) | Bank A/c | Dr. | 38,200 | ||
| Calls in advance A/c | Dr. | 1,000 | |||
| Calls in Arrear A/c | Dr. | 800 | |||
| To Share Final Call A/c | 40,000 | ||||
| (Being final call money received 19,500 shares & call in advance on 500 shares adjusted) | |||||
| A Ltd. Balance Sheet |
|||
| Particulars | Note no/. |
Current year |
|
| i) | Equity & Liability | ||
| Shareholders fund | |||
| Share Capital | 1 | 1,99,200 | |
| Reserve & Surplus | 2 | 20,000 | |
| Total | 2,19,200 | ||
| ii) | Assets | ||
| Current Assets | |||
| Cash & Cash equivalent | 3 | 2,19,200 | |
| Total | 2,19,200 | ||
| Notes to Accounts:- |
|||
| Particulars | Details | Amount | |
| 1) | Shared capital | ||
| Authorized capital | |||
| Issued capital | |||
| 20,000 Equity shares of Rs. 10 each | 2,00,000 | ||
| Subscribed capital | |||
| (i) Subscribed & fully Paid up | |||
| 19,600 shares of Rs. 10 each full called & paid | 1,96,000 | ||
| (ii) Subscribed & not fully Paid up | |||
| 400 shares of Rs. 10 each fully called | 4,000 | ||
| Less : Calls in Arrears (400 X 2) | 800 | 1,99,200 | |
| 2) | Reserve & Surplus | ||
| Securities Premium Reserve | 20,000 | ||
| 3) | Cash & Cash equivalent | ||
| Cash at Bank | 2,19,200 | ||
Called up Capital : It has already been explained that it is not necessary that a company calls the entire amount of nominal (face) value of share by the close of accounting year . In such cases , called up portion of share capital is shown in the balance sheet as subscribed capital but fully paid .
End of Solution
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Chapter No. 8 – Company Accounts (Share Capital)
Chapter No. 9 – Company Accounts (Issue of Debentures)
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