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Question no 11 Chapter 1 – Unimax Class 12 Part 2 – 2021

Question no -11 Chapter no-1 Unimax Class-12 Part-II
Question no -11 Chapter no-1 Unimax Class-12 Part-II

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Question No  11 Chapter 1 – Unimax Class 12 Part 2 – 2021

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Bharat Limited purchases certain patents from Sharp and short under an agreement dated the June 30, 2022 at a cost of ₹ 40,000 which was paid ₹ 1,000 in cash to the vendors and the balance in fully paid equity shares of ₹ 10 each.
Including the shares allotted as fully paid to the vendors, the company issued capital to the extent of ₹ 75,000 consisting of ₹ 50,000 in equity shares of ₹ 10 each ( ₹ 3 on application, ₹ 3 on allotment and ₹ 4 at the end end of three months) and ₹ 25,000 in 10% preference shares of ₹ 10 each ( ₹ 4 on application, ₹ 3 on allotment and ₹ 3 at the end of three months).
Under the agreement with sharp and short, the patents passed to the company on July 9, 2022 on which all the shares were allotted to the public also. All the shares issued to the public were fully subscribed and all the money called duly received.
All cash paid direct to company’s bankers.
Record journal entries.

The solution of Question 11 Chapter 1 of +2 Part-2: –

Journal
Books of M/S Bharti Ltd.

Date  Particulars
L.F.DebitCredit
July 9Patents A/cDr. 40,000 
 To M/s sharp and Short A/c   40,000
 (Being Patents purchased)    
July 9M/s sharp and Short A/cDr. 40,000 
 To Equity share capital A/c  39,000
 To Cash A/c   1,000
 (Being 3900 equity shares of ₹ 10 each issued to Vendor)    
July 9Equity share Application A/cDr. 3,300 
 To Equity share capital A/c  3,300
 (Being application money due on 1100 equity shares @ ₹ 3 and balance transfer to share capital A/c)    
July 9Preference share application A/cDr. 10,000 
 To 10% Preference share capital A/c  10,000
 (Being preference share application A/c transferred to 10% preference share capital A/c)    
July 9Equity share Allotment A/cDr. 3,300 
 To Equity Share capital A/c  3,300
 (Being allotment money due on 11000 equity shares @ ₹ 3 per share)   
July 9Preference shares allotment A/cDr. 7,500 
 To 10% Preference share capital A/c  7,500
 (Being allotment money due on 2500 preference shares @ ₹ 3 each)   
Oct.9Equity share first and final A/cDr. 4,400 
 To Equity share capital A/c  4,400
 (Being first call money due on 1100 equity shares @ ₹ 4 each)   
Oct.9Preference share 1st and final call A/cDr. 7,500 
 To Equity shares capital A/c  7,500
 (Being 1st and Final call money due on 2500preference shares @ ₹ 3 pre share)   

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