Question 73:
Sunshine
Ltd. issued 20,000 shares of ₹100 each payable ₹25 per share on
application , ₹25 per share on
allotment and the balance in two calls of ₹25 each. The company did not make the
final call of ₹25 per share.
All the money was duly received with the exception of the amount due on the
first call on 400 shares held by Mr. Modi. The Board of Directors forfeited
these shares and subsequently reissued them @ ₹75 per share
paid-up for a sum of ₹28,000.
Journalise the above transactions and prepare Share Capital Account.
Answer:
Issued and applied capital 20,000 shares of ₹100 each
Payable as:
|
Application |
₹ |
25 |
|
|
Allotment |
₹ |
25 |
|
|
First Call |
₹ |
25 |
|
|
Called-up |
₹ |
75 |
per share |
|
Final Call |
₹ |
25 |
|
|
|
₹ |
100 |
per share |
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit (₹) |
Credit (₹) |
|
|
|
|
|
|
|
|
|
|
Bank A/c |
Dr. |
|
5,00,000 |
|
|
|
To Share Application A/c |
|
|
5,00,000 |
|
|
|
(Share application money received for 20,000 shares at ₹25 each) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Application A/c |
Dr. |
|
5,00,000 |
|
|
|
To Share Capital A/c |
|
|
5,00,000 |
|
|
|
(Application money transferred to Share Capital Account) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Allotment A/c |
Dr. |
|
5,00,000 |
|
|
|
To Share Capital A/c |
|
|
5,00,000 |
|
|
|
(Share Allotment due on 20,000 shares at ₹25 each) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank A/c |
Dr. |
|
5,00,000 |
|
|
|
To Share Allotment A/c |
|
|
5,00,000 |
|
|
|
(Allotment money received) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share First Call A/c |
Dr. |
|
5,00,000 |
|
|
|
To Share Capital A/c |
|
|
5,00,000 |
|
|
|
(Share First Call due on 20,000 shares of ₹25 each) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank A/c |
Dr. |
|
4,90,000 |
|
|
|
Calls-in-Arrears A/c |
Dr. |
|
10,000 |
|
|
|
To Share First Call A/c |
|
|
5,00,000 |
|
|
|
(Share First Call ₹25 per share received on 19,600 shares and a holder of 400 shares did not pay it) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Capital A/c |
Dr. |
|
30,000 |
|
|
|
To Share Forfeiture A/c |
|
|
20,000 |
|
|
|
To Calls-in-Arrears A/c |
|
|
10,000 |
|
|
|
(400 shares of ₹100 each, ₹75 called-up, forfeited for the non-payment of Share First Call ₹25 per share) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank A/c |
Dr. |
|
28,000 |
|
|
|
Share Forfeiture A/c |
Dr. |
|
2,000 |
|
|
|
To Share Capital A/c |
|
|
30,000 |
|
|
|
(400 shares of ₹100 each, ₹75 paid-up, reissued for the sum of ₹28,000) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Forfeiture A/c |
Dr. |
|
18,000 |
|
|
|
To Capital Reserve A/c |
|
|
18,000 |
|
|
|
(Balance in share forfeiture after re-issue, transferred to capital reserve) |
|
|
|
|
|
|
|
|
|
|
|
|
Share Capital Account |
|||||
|
Dr. |
|
Cr. |
|||
|
Particulars |
(₹) |
Particulars |
(₹) |
||
|
|
|
|
|
||
|
Share Forfeiture |
20,000 |
Share Application |
5,00,000 |
||
|
Calls-in-Arrears |
10,000 |
Share Allotment |
5,00,000 |
||
|
|
|
Share First Call |
5,00,000 |
||
|
|
|
Bank |
28,000 |
||
|
Balance c/d |
|
Share Forfeiture |
2,000 |
||
|
|
|
|
|
||
|
|
15,30,000 |
|
15,30,000 |
||
|
|
|
|
|
||
Working Note-
|
Share Forfeiture Credit |
20,000 |
|
Less: Share Forfeiture Debit |
2,000 |
|
Balance in Share Forfeiture Account after re-issue |
18,000 |
Capital Reserve = Balance in Share Forfeiture Account after re-issue
= ₹18,000
Question 74:
Mahira Ltd. forfeited 800 shares of ₹10 each on which first call of ₹3 per share was not received. The second and final call of ₹2 per share was not yet called. Out of these, 400 shares were reissued as ₹8 paid-up for ₹7 per share.
Pass the necessary Journal entries.
(CBSE 2025)
Answer:
|
|
In the Books of Mahira Ltd. Journal |
||||||
|
Date |
Particulars |
L.F. |
Debit (₹) |
Credit (₹) |
|||
|
Equity Share Capital A/c |
Dr. |
6,400 |
|||||
|
To Forfeited Shares A/c |
|
4,000 |
|||||
|
To Share First Call A/c |
|
2,400 |
|||||
|
(Being 800 shares forfeited for non-payment of first call of ₹3 per share, with ₹8 called up per share) |
|||||||
|
|
|||||||
|
Bank A/c |
Dr. |
2,800 |
|||||
|
Forfeited Shares A/c |
Dr. |
400 |
|||||
|
To Equity Share Capital A/c |
|
3,200 |
|||||
|
(Being 400 forfeited shares reissued at ₹7 per share as ₹8 paid-up) |
|||||||
|
|
|||||||
|
Forfeited Shares A/c |
Dr. |
1,600 |
|||||
|
To Capital Reserve A/c |
|
1,600 |
|||||
|
(Being the gain on reissue of 400 shares transferred to Capital Reserve) |
|||||||
|
|
|
|
|
|
|||
Working Notes:
1. Called-up value per share:
Face Value ₹10- Uncalled Second call ₹2= ₹8 per share
2. Amount received (Forfeited) per share:
Called-up ₹8-uppaid First Call ₹3= ₹5 per share
Total share forfeiture credit = 800 shares × ₹5 = ₹ 4,000
3.
Discount
allowed on Reissue:
Paid – up value ₹8- Reissue price ₹7 = ₹ 1
Total shares forfeited 400
Total shares forfeited 400× ₹1 = ₹ 400
4. Transfer to Capital Reserve:
Forfeited amount on 400 reissued shares 400×5 =₹ 2,000
Amount left after deduction of discount from forfeited amount to be transferred to capital reserve = ₹2,000-₹400=₹1,600
Question 75:
The
Hindustan Manufacturing Ltd. had a total subscribed capital of ₹10,00,000
in Equity Shares of ₹10 each of which ₹7.50 were
called-up. A final call of ₹2.50 was made and all amount paid
except two calls of ₹2.50 each in respect of 100 shares held
by D . These shares were forfeited and reissued at ₹8 per
share .
Pass necessary journal entries (including that of cash) to record the
transactions of final call , forfeiture of shares and reissue of forfeited
shares . Also, prepare the Balance Sheet of the company.
Answer:
|
Books of Hindustan Manufacturing Limited |
|||||
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ₹ |
Credit ₹ |
|
|
|
|
|
|
|
|
|
|
Equity Share Final Call A/c |
Dr. |
|
2,50,000 |
|
|
|
To Equity Share Capital A/c |
|
|
2,50,000 |
|
|
|
(Share Final Call due on 1,00,000 shares at ₹2.5 per share) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank A/c |
Dr. |
|
2,49,750 |
|
|
|
Calls-in-Arrears A/c |
Dr. |
|
250 |
|
|
|
To Equity Share Final Call A/c |
|
|
2,50,000 |
|
|
|
(Share Final Call of ₹2.5 per share received from 99,900 shares and 100 shares did not pay it) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Share Capital A/c |
Dr. |
|
1,000 |
|
|
|
To Share Forfeiture A/c |
|
|
500 |
|
|
|
To Calls-in-Arrears A/c |
|
|
500 |
|
|
|
(100 shares of ₹10 each forfeited for the non-payment of two calls of ₹2.5 each) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank A/c |
Dr. |
|
800 |
|
|
|
Share Forfeiture A/c |
Dr. |
|
200 |
|
|
|
To Equity Share Capital A/c |
|
|
1,000 |
|
|
|
(100 shares of ₹10 each reissued at ₹8 per share, fully paid-up) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Forfeiture A/c |
Dr. |
|
300 |
|
|
|
To Capital Reserve A/c |
|
|
300 |
|
|
|
(Balance in Share Forfeiture Account after re-issue of shares, transferred to Capital Reserve) |
|
|
|
|
|
|
|
|
|
|
|
As per the Schedule III of Companies Act, 2013, the Company's Balance Sheet is presented as follows.
|
Hindustan Manufacturing Ltd. |
||
|
Balance Sheet |
||
|
Particulars |
Note No. |
(₹) |
|
I. Equity and Liabilities |
|
|
|
1. Shareholders’ Funds |
|
|
|
a. Share Capital |
1 |
10,00,000 |
|
b. Reserves and Surplus |
2 |
300 |
|
2. Non-Current Liabilities |
|
|
|
3. Current Liabilities |
|
|
|
Total |
|
10,00,300 |
|
|
|
|
|
II. Assets |
|
|
|
1. Non-Current Assets |
|
|
|
2. Current Assets |
|
|
|
a. Cash and Cash Equivalents |
3 |
10,00,300 |
|
Total |
|
10,00,300 |
|
|
|
|
NOTES TO ACCOUNTS
|
|
||
|
Note No. |
Particulars |
(₹) |
|
1 |
Share Capital |
|
|
|
Authorised Share Capital |
|
|
|
1,00,000 shares of ₹10 each |
10,00,000 |
|
|
Issued Share Capital |
|
|
|
1,00,000 shares of ₹10 each |
10,00,000 |
|
|
Subscribed, Called-up and Paid-up Share Capital |
|
|
|
1,00,000 shares of ₹10 each |
10,00,000 |
|
|
|
|
|
2 |
Reserves and Surplus |
|
|
|
Capital Reserve |
300 |
|
|
|
|
|
3 |
Cash and Cash Equivalents |
|
|
|
Cash at Bank |
10,00,300 |
|
|
|
|
Working Notes:
|
Share Forfeiture Credit (100 shares × ₹5 each) |
500 |
|
|
Less: Share Forfeiture Debit (100 share × ₹2 each) |
200 |
Loss on re-issue |
|
Balance in Share Forfeiture Account after re-issue |
300 |
|
Capital Reserve = Balance in Share Forfeiture Account after re-issue = ₹300
Question 76:
Star Ltd. forfeited 500 Equity Shares of ₹100 each for non-payment of first call of ₹30 per share . The final call of ₹10 per share was not yet made. Out of these, 60% shares were reissued for ₹39,000 fully paid. journalise the forfeiture and reissue of shares.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit (₹) |
Credit (₹) |
|
|
|
Equity Share Capital A/c (500×90) |
Dr. |
|
45,000 |
|
|
|
To Equity Share 1st Call A/c (500×30) |
|
|
|
15,000 |
|
|
To Share Forfeited A/c (500×60) |
|
|
|
30,000 |
|
|
(500 equity shares forfeited for non-payment of final call) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank A/c (300×130) |
Dr. |
|
39,000 |
|
|
|
To Equity Share Capital A/c (300×100) |
|
|
|
30,000 |
|
|
To Security Premium Reserve A/c (300×30) |
|
|
|
9,000 |
|
|
(300 shares are reissued @130 per share) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Forfeited A/c |
Dr. |
|
18,000 |
|
|
|
To Capital Reserve A/c |
|
|
|
18,000 |
|
|
(Prof it on reissue of 300 shares transferred to Capital Reserve) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Working Note:
Amount transferred to Capital Reserve
Shares Re-issued = 300
Shares Forfeited = 500
Amount forfeited in respect of 300 shares = Amount Forfeited × Shares Re-issued Shares Forfeited
= 30,000×300500=18,000
Ts Grewal Solution 2026-2027
Click below for more Questions
Class 12 / Volume – 2
Chapter 1- Company Accounts- Accounting for Share Capital
Question No. 1 To 4
Question No. 5 To 8
Question No. 9 To 12
Question No. 13 To 16
Question No. 17 To 20
Question No. 21 To 24
Question No. 25 To 28
Question No. 29 To 32
Question No. 33 To 36
Question No. 37 To 40
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Question No. 45 To 48
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