Question 40 Chapter 8 of +2-A

Question 40 Chapter 8 of +2-A

Alpha Ltd. Issued 20,000 equity shares of Rs 10 each at par payable: on application Rs 2 per share; on allotment RS 3 per share; on first call Rs 2 per share.

Mr Gupte was allotted 100 shares. Pass necessary journal entry relating to the forfeiture of shares in each of the following alternative cases.

 Case I if Mr.Gupta failed to pay the allotment money and his share was immediately forfeited.
Case II if Mr.Gupta failed to pay the first call and on his subsequent failure to pay the second and final call, his shares were forfeited.
Case III if Mr.Gupta failed to pay the first call and on his subsequent failure to pay the second and final call, his shares were forfeited.   

The solution of Question 40 Chapter 8 of +2-A: – 

Case I
 Particulars
L.F.DebitCredit
 Bank A/cDr 40,000 
 To share application A/c   40,000
 (Being the application money received )    
  Share application A/cDr 40,000 
 To Share capital A/c   40,000
 (Being application money transferred to equity share capital )    
 Share allotment A/cDr 60,000 
 To Share capital A/c   60,000
 (Being the allotment money due )    
 Bank A/cDr 59,700 
 calls in arrear A/cDr 300 
 To Share allotment A/c   60,000
 (Being application money transferred to equity share capital )    
 Share capital A/cDr 500 
 To share allotment. A/c   300
 To forfeited shares A/c   200
 (Being share forfeited )    

 

Case II
 Particulars
L.F.DebitCredit
 Bank A/cDr 40,000 
 To share application A/c   40,000
 (Being the application money received )    
  Share application A/cDr 40,000 
 To Share capital A/c   40,000
 (Being application money transferred to equity share capital )    
 Share allotment A/cDr 60,000 
 To Share capital A/c   60,000
 (Being the allotment money due )    
 Bank A/cDr 59,700 
 calls in arrear A/cDr 300 
 To Share allotment A/c   60,000
 (Being application money transferred to equity share capital )    
  Share first call A/cDr 60,000 
 To Share capital A/c   60,000
 (Being the first call money due )    
 Bank A/cDr 59,700 
 Calls in arrear A/cDr 300 
 To Share first call A/c   60,000
 (Being first call money received )    
 Share capital A/cDr 800 
 To forfeited shares A/c   200
 To share allotment. A/c   300
 To Shares first, call A/c   300
 (Being share forfeited )    

 

Case III
 Particulars
L.F.DebitCredit
 Bank A/cDr 40,000 
 To share application A/c   40,000
 (Being the application money received )    
  Share application A/cDr 40,000 
 To Share capital A/c   40,000
 (Being application money transferred to equity share capital )    
 Share allotment A/cDr 60,000 
 To Share capital A/c   60,000
 (Being the allotment money due )    
 Bank A/cDr 59,700 
 calls in arrear A/cDr 300 
 To Share allotment A/c   60,000
 (Being application money transferred to equity share capital )    
  Share first call A/cDr 60,000 
 To Share capital A/c   60,000
 (Being the first call money due )    
 Bank A/cDr 59,700 
 Calls in arrear A/cDr 300 
 To Share first call A/c   60,000
 (Being first call money received )    
  Share second and final call A/cDr 40,000 
 To Share capital A/c   40,000
 (Being the second and final call money due )    
 Bank A/cDr 39,800 
 Calls in arrear A/cDr 200 
 To Share second and final A/c   40,000
 (Being second and final money received )    
 Share capital A/c  1,000 
 To forfeited shares A/c   500
 To Share the first call. A/c   300
 To Shares final call A/c   200
 (Being share forfeited )    

 

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Also, Check out the solved question of previous Chapters: –

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

2 Book 2 min - Question 40 Chapter 8 of +2-A - T.S. Grewal 12 Class
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

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