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Question 39 Chapter 8 of +2-Part-1
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39. (Prorata Allotment/Forfeiture/Reissue) Indian Oil Company issued 20,000 shares of RS. 10 each payable Rs. 2 on application; Rs. 4 on allotment and balance in two equal calls. It received applications for 24,000 shares. The pro-rata allotment was made on applied shares. Excess application money was retained.
Kuljeet who was allotted 500 shares did not pay allotment money and two subsequent calls. His shares were forfeited and reissued at Rs. 8 per share fully paid up.
Pass necessary entries.
The solution of Question 39 Chapter 8 of +2 Part-1: –
| Journal | |||||
| Date | Particulars | L.F. | Debit | Credit | |
| A) | Bank A/c (24,000 X 2) | Dr. | 48,000 | ||
| To Share Application A/c | 48,000 | ||||
| (Being the receipt of application money on 24,000 shares @ Rs.2 per share ) | |||||
| B) | Share Application A/c | Dr. | 48,000 | ||
| To Share capital A/c | 40,000 | ||||
| To Share allotment l A/c | 8,000 | ||||
| (Being the application money Adjusted ) | |||||
| C) | Share Allotment A/c | Dr. | 80,000 | ||
| To Share capital A/c | 80,000 | ||||
| (Being allotment money due on allotment of 20,000 shares @ Rs. 4 per share ) | |||||
| D) | Bank A/c | Dr. | 70,200 | ||
| To Share allotment A/c | 70,200 | ||||
| (Being balance allotment money received on 19,500 shares) | |||||
| E) | Share first Call A/c | Dr. | 40,000 | ||
| To Share capital A/c | 40,000 | ||||
| (Being amount due on first call) | |||||
| F) | Bank A/c | Dr. | 39,000 | ||
| To Share final Call A/c | 39,000 | ||||
| (Being amount received on final call of 48,500 share ) | |||||
| G) | Share final Call A/c | Dr. | 40,000 | ||
| To Share capital A/c | 40,000 | ||||
| (Being amount due on final call ) | |||||
| H) | Bank A/c | Dr. | 39,000 | ||
| To Share final Call A/c | 39,000 | ||||
| (Being amount received on final call of 19500 share ) | |||||
| I) | Share capital A/c | Dr. | 5,000 | ||
| To Share Allotment A/c | 1,800 | ||||
| To Share first call A/c | 1,000 | ||||
| To Share Second final call A/c | 1,000 | ||||
| To Share Forfeited A/c | 1,200 | ||||
| (Being 500 shares fortified) | |||||
| J) | Bank A/c (500 X 8 ) | Dr. | 4,000 | ||
| Share Fortified A/c (500X2) | Dr. | 1,000 | |||
| To Share capital A/c | 5,000 | ||||
| (Being 500 shares reissued) | |||||
| K) | Share Fortified A/c | Dr. | 200 | ||
| To Capital Reserve A/c | 200 | ||||
| (Being balance in share fortified transferred to capital reserve) | |||||
Working Notes :
Shares applied by Kuljeet= (24,000/20,000 )X 500 = 600 share
Excess app. Money paid by Kuljeet = 100 X 2 = Rs. 200
Amount due from Kuljeet on allotment = 500 X 4 = Rs. 4,000
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Less Advance App. Money received = Rs. 200
Amount not paid by Kuljeet on allotment = Rs 1,800
It all about Question 38 Chapter 8 of +2-Part-1, If you have any problem please comment below.
Forfeiture of shares – Its accounting Entries
End of Solution
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Chapter-Wise Solution of Usha Publication Accountancy – Part 2 Class 12 – Session 2024-25 as per the PSEB curriculum
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Chapter No. 8 – Company Accounts (Share Capital)
Chapter No. 9 – Company Accounts (Issue of Debentures)
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Chapter No. 11 – Financial Statements of a Company
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- Chapter No. 1 – Company Accounts (Share Capital)
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