Question 51 Chapter 8 of +2-Part-1 – USHA Publication 12 Class Part – 1

Q-51 - CH-8 - Usha +2 Book 2018 - Solution-min

Question 51 Chapter 8 of +2-Part-1

Free Accounting book Solution - Class 11 and Class 12

51. (Prorata Allotment/Forfeiture/Reissue) Z Ltd. invited applications for issuing 2,00,000equity shares of Rs. 25 per share. The amount was payable as follows:
On Application and allotment Rs. 10 per share Balance on first and final balance amount. Applicants for 2,50,000 shares were received. Applications for 25,000 shares were rejected and shares were allotted on pro-rata basis to the remaining applicants. All calls were made and were duly received except the first and final call on 2,000 shares allotted to Vijay. His shares were forfeited. The forfeited shares were reissued @ Rs. 30 per share fully paid up.
Pass necessary journal entries in the books of the company

The solution of Question 51 Chapter 8 of +2 Part-1: –

Journal

Date   Particulars
L.F. Debit Credit
A) Bank A/c( 2,50,000 X 10) Dr.   25,00,000  
  To Share Application Allotment A/c       25,00,000
  (Being the receipt of application money)        
           
B) Share Application A/c Dr.   25,00,000  
  To Share capital A/c     20,00,000
  To Share first & Final A/c     2,50,000
  To Bank A/c (25,000 X 10)     2,50,000
  (Being 2,00,000 shares allotted on pro-rata basis & money refunded on 25,000 rejected )        
           
C) Share final Call A/c Dr.   30,00,000  
  To Share capital A/c     30,00,000
  (Being final due on 2,00,000 shares @ Rs. 15 )        
         
D) Bank A/c Dr.   27,22,500  
  Calls in arrears A/c Dr.   27,500  
  To Share final A/c     27,50,000
  (Being amount received on final call )      
         
E) Share capital A/c Dr.   50,000  
  To Share Forfeited A/c     27,500
  To Calls in Arrears A/c     22,500
  (Being 2,000 shares fortified)      
         
F) Bank A/c Dr.   60,000  
  To Share capital A/c     50,000
  To Securities Premium A/c     10,000
  (Being 2,000 shares reissued)      
         
G) Share Fortified A/c Dr.   22,500  
  To Capital Reserve A/c     22,500
  (Being balance in share fortified transferred to capital reserve)      

Working Notes:

Shares applied by Vijay = 2,25,000/2,00,000X2,000=2,250 shares

Application & Allotment Money received 2,250 X 10 22,500
Less : Application money adjusted on 2,000 shares X 10 ) 20,000
Retained for call 2,500
Total final due (2,00,000 X 15 ) 30,00,00
Less : Already Retained 2,50,000
Less : not Received from Vijay on call ( 2,000 X 15) – 2,500 27,500
Not Received on call 27,22,500

It all about Question 51 Chapter 8 of +2-Part-1, If you have any problem please comment below.

Forfeiture of shares – Its accounting Entries

You can also Check out the solved question of other Chapters: –

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

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

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