Question no 72 Chapter 1 - UNIMAX Class 12 Part 2

Question No 72 Chapter 1 – UNIMAX Class 12 Part 2 – 2021

Table of Contents

The solution of Question 72 Chapter 1 of +2 Part-2: –

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

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

Z Ltd. invited applications for issuing 50,000 equity shares of ₹ 10 each. The amount was payable as follows:

On application	₹ 3 per share
On allotment	₹ 4 per share
On first & final call	₹ 3 per share

Applications for 75,000 shares were received and pro-rata allotment was mode as follows:
Application for 40,000 shares were allotted 30,000 shares on pro-rata basis.
Application for 35,000 shares were allotted 20,000 shares on pro-rata basis.
Ramu to whom 1,200 shares were allotted out of the group applying for 40,000 shares failed to pay the allotment money. His shares were forfeited immediately after allotment.
Shamu who had applied for 700 shares out of the group applying for 35,000 shares failed to pay the allotment money. His shares were forfeited immediately after allotment.
Out of the forfeited shares 1,000 shares were reissued @ 3 per share fully paid up. The reissued shares included all the forfeited shares of Shamu.
Pass necessary journal entries to record the above transactions.

The solution of Question 72 Chapter 1 of +2 Part-2: –

Journal

Date	Particulars		L.F.	Debit	Credit
	Bank A/c	Dr.		2,25,000
	To Equity share application A/c				2,25,000
	(Being application money received on 75,000 shares @ ₹ 3 each)
	Equity share application A/c	Dr.		2,25,000
	To Equity share capital A/c				1,50,000
	To Equity share allotment A/c				75,000
	(Being application money transferred to share capital A/c & share allotment)
	Equity shares allotment A/c	Dr.		2,00,000
	To Equity shares capital A/c				2,00,000
	(Being allotment money due on 50,000 shares @ 4 per share)
	Bank A/c	Dr.		1,20,700
	To Equity shares allotment A/c				1,20,700
	(Being allotment money received except on 1600 shares)
Ramu	Equity share capital A/c	Dr.		8400
	To Equity share allotment A/c				3600
	To Share forfeited A/c				4800
	(Being 1200 shares forfeited due to non-payment of allotment)
Shamu	Equity share capital A/c	Dr.		2800
	To Equity shares allotment A/c				700
	To Share forfeited A/c				2100
	(Being 400 shares forfeited due to non-payment of allotment money)
	Bank A/c	Dr.		9,000
	Share forfeited A/c	Dr.		1,000
	To Equity share capital A/c				10,000
	(Being 1000 share forfeited reissued @ ₹ 9 per share fully paid up)
	Share forfeited A/c	Dr.		3500
	To capital reserve A/c				3500
	(Being the profit on 1000 forfeited shares transferred to capital reserve A/c)

Working Note:

	Shares applied	Shares allotted
Lot 1	40,000	30,000
	35,000	20,000
	75,000	50,000

1 Table showing adjustment of excess amount received on application.

	Lot 1	Lot 2	total
No. of shares applied	40,000	35,000	75,000
Less: no. of shares allotted	30,000	20,000	50,000
Over subscription	10,000	15,000	25,000

	₹	₹	₹
Excess amount received on application @ ₹ 3	30,000	45,000	75,000
Less: amount adjusted on allotment @ ₹ 4	30,000	45,000	75,000
Refunded to be made	Nil	Nil	Nil

2 Net Amount received on allotment

No. of share allotted to Ramu = 1200 share
No. of shares applied by Ramu = 1200 x 40,000/30,000	1600 share
	₹
Application money received on (1600 shares of Mr. Ramu 1600*3)	4800
Less: actual application amount on 1200 shares (1200*3)	3600
Excess application money adjusted towards allotment	1200
	₹
Allotment amount due Mr. Ramu on 1200 shares = 1200 x 4	4800
Less: Excess application money adjusted	1200
	3600

No. of shares applied by Mr. Shamu	700share
No of shares allotted to Mr. Shamu = 700 x 20,000/35,000	400share
	₹
Application money received on 700 shares of Mr. Shamu (700 x 3)	2100
Less: actual application amount on 400 shares (400 x 3)	1200
Amount not paid by Mr. Ramu	3600
No. of shares applied by Mr. Shamu	700share
No. of shares allotted to Mr. Shamu = 700 x 20,000/35,000	400share
	₹
Application money received on700 shares of Mr. Shamu (700 x 3)	2100
Less: Actual application amount on 400 shares (400 x 3)	1200
Excess application money adjusted towards allotment	900
	₹
Allotment amount due from Mr. Shamu on 400 shares = (44 x 4)	1600
Less: Excess application money adjusted	900
Amount not paid by Mr. Shamu	700
	₹
Total amount due on allotment = (50000 x 4)	2,00,000
Less: application money already adjusted	75000
	1,25,000
Less: amount not paid by Mr. Shamu	3600
	1,21,400
Less: amount not paid by Mr. Shamu	700
Net amount received on allotment	1,20,700

4 Calculation of amount to be transferred to Capital Reserve


Amount forfeited on 1200 shares of Mr. Ramu = ₹ 4800
Amount forfeited on 600 shares of Mr. Ramu =4800 x 600/1200 = 2400
Amount forfeited on 400 shares of Mr. Shamu = ₹ 2100
Amount forfeited on 600 shares of Mr. Shamu = ₹ 2400
Total amount of forfeited on 1000 shares = 4500
Less discount allowed on reissued shares = 4500
Balance credited to capital reserve a/c = 3500