12th | Accounting for Share Capital | Question No. 101 To 104 | Ts Grewal Solution 2025-2026

Question 101:

Alfa Ltd. invited applications for issuing 75,000 equity shares of ₹ 10 each. The amount was payable as follows:

On application and allotment	—	₹4 per share ,
On first Call	—	₹ 3 per share,
On second and final Call	—	balance.

Applications for 1,00,000 shares were received. Shares were allotted to all the applicants on pro rata basis and excess money received with applications was transferred towards sums due on first call. Vibha who was allotted 750 shares failed to pay the first call . Her shares were immediately forfeited . Afterwards the second call was made. The amount due on second call was also received except on 1,000 shares applied by Monika . Her shares were also forfeited. All the forefited shares were reissued to Mohit for ₹9,000 as fully paid-up.
Pass necessary journal entries in the Books of Alfa Ltd. for the above transactions. (CBSE 2015)

Answer:

In the books of Alfa Ltd. Journal Entry
Date	Particulars		L.F.	Debit ₹	Credit ₹
	Bank A/c	Dr.		4,00,000
	To Equity Share Application and Allotment A/c				4,00,000
	(Application money received on 1,00,000 shares)

	Equity Share Application and Allotment A/c	Dr.		4,00,000
	To Equity Share Capital A/c				3,00,000
	To Equity Share First Call A/c				1,00,000
	(Application money transferred to share capital account and excess money is adjusted in first call account)

	Equity Share First Call A/c	Dr.		2,25,000
	To Equity Share Capital A/c				2,25,000
	(Amount due on first call)

	Bank A/c (2,25,000 – 1,00,000 – 1,250)	Dr.		1,23,750
	To Equity Share First Call A/c				1,23,750
	(Amount received on first call)

	Equity Share Capital A/c	Dr.		5,250
	To Equity Share Forfeiture A/c				4,000
	To Equity Share First Call A/c				1,250
	(Vibha’s shares were forfeited)

	Equity Share Second and Final Call A/c	Dr.		2,22,750
	To Equity Share Capital A/c				2,22,750
	(Amount due on second and final call after forfeiting Vibha’s shares)

	Bank A/c (2,22,750 – 2,250)	Dr.		2,20,500
	To Equity Share Second and Final Call A/c				2,20,500
	(Amount received on second and final call)

	Equity Share Capital A/c	Dr.		7,500
	To Equity Share Forfeiture A/c				5,250
	To Equity Share Second and Final Call A/c				2,250
	(Monika’s shares were forfeited)

	Bank A/c	Dr.		9,000
	Equity Share Forfeiture A/c	Dr.		6,000
	To Equity Share Capital A/c				15,000
	(Forfeited shares were reissued for ₹9,000 as fully paid-up)

	Equity Share Forfeiture A/c	Dr.		3,250
	To Capital Reserve A/c				3,250
	(Excess amount on forfeiture is transferred to capital reserve)

Working Notes:

WN1: Calculation of Amount not received on First Call

Share applied by vibha=1,00,000/75,000×750= 1,000 share

Amount received on 1000 share@4 ₹. Each= ₹. 4,000

Amount transferred to share capital A/c(750×4)=3,000

Excess application and allotment money received=1000

Amount due on first call @3 ₹. 2,250

Amount not received on first call @3=1,250(2,250-1,000)

WN2: Calculation of Amount not received on Second Call

Allotted share to Monika =75,000×1000/1,00,000=750 shares

Amount not received on second call=2,250(750×3)

Question 102:

Himalaya Company Limited issued for public subscription 1,20,000 equity shares of ₹ 10 each at a premium for ₹ 2 per share payable as under:

With Application	—	₹3 per share,
On allotment (including premium)	—	₹ 5 per share,
On First call	—	₹ 2 per share
On Second and Final call	—	₹ 2 per share.

Applications were received for 1,60,000 shares . Allotment was made on pro rata basis . Excess money on application were adjusted against the amount due on allotment.
Rohan to whom 4,800 shares were allotted failed to pay for the two calls. These shares were subsequently forfeited after the second call was made . All the shares forfeited were reissued to Teena as fully paid at ₹ 7 per share.
Record journal entries and show the transactions relating to share capital in the company's Balance Sheet. (NCERT)

Answer:

Books of Himalaya Company Ltd. Journal
Date	Particulars		L.F.	Debit (₹)	Credit (₹)
	Bank A/c	Dr.		4,80,000
	To Share Application A/c				4,80,000
	(Share Application money received for 1,60,000 shares @ ₹3 per share)

	Share Application A/c	Dr.		4,80,000
	To Equity Share Capital A/c				3,60,000
	To Share Allotment A/c				1,20,000
	(Share Application for 1,20,000 shares @ ₹3 per share transferred to Share Capital Account and remaining amount adjusted to Allotment)

	Share Allotment A/c	Dr.		6,00,000
	To Equity Share Capital A/c				3,60,000
	To Securities Premium				2,40,000
	(Share Allotment due on 1,20,000 shares @ ₹5 per share including ₹2 Securities Premium)

	Bank A/c	Dr.		4,80,000
	To Share Allotment A/c				4,80,000
	(Share allotment for 1,20,000 shares @ ₹5 per share received)

	Share First Call A/c	Dr.		2,40,000
	To Equity Share Capital A/c				2,40,000
	(Share First Call due on 1,20,000 shares @ ₹2 per share)

	Bank A/c	Dr.		2,30,400
	To Share First Call A/c				2,30,400
	(Share First Call received on 1,15,200 shares @ ₹2 per share and 4,800 shares failed to pay)

	Share Final Call A/c	Dr.		2,40,000
	To Equity Share Capital A/c				2,40,000
	(Share Final call due on 1,20,000 shares @ ₹2 per share)

	Bank A/c	Dr.		2,30,400
	To Share Final Call A/c				2,30,400
	(Share Final Call received on 1,15,200 shares @ ₹2 per share and 4,800 shares failed to pay)

	Equity Share Capital A/c (4,800×10)	Dr.		48,000
	To Share First Call A/c (4,800×2)				9,600
	To Share Final Call A/c (4,800×2)				9,600
	To Share Forfeiture A/c (4,800×6)				28,800
	(4,800 shares forfeited for the non–payment of First Call and Final Call)

	Bank A/c	Dr.		33,600
	Share Forfeiture A/c	Dr.		14,400
	To Equity Share Capital				48,000
	(4,800 shares reissued @ ₹7 per share, fully paid–up)

	Share Forfeiture A/c	Dr.		14,400
	To Capital Reserve A/c				14,400
	(Share forfeiture balance of 4,800 shares transferred to Capital Reserve Account)

Himalaya Company Limited
Balance Sheet
Particulars	Note No.	(₹)
I. Equity and Liabilities
1. Shareholders’ Funds
a. Share Capital	1	12,00,000
b. Reserves and Surplus	2	2,54,400
2. Non-Current Liabilities
3. Current Liabilities
Total		14,54,400
II. Assets
1. Non-Current Assets
2. Current Assets
a. Cash and Cash Equivalents	3	14,54,400
Total		14,54,400

NOTES TO ACCOUNTS

Note No.	Particulars		(₹)
1	Share Capital
	Authorised Share Capital
	…….. shares of ₹10 each		–
	Issued Share Capital
	1,20,000 shares of ₹10 each		12,00,000
	Subscribed, Called-up and Paid-up Share Capital
	1,20,000 shares of ₹10 each		12,00,000

2	Reserves and Surplus
	Securities Premium	2,40,000
	Capital Reserve	14,400	2,54,400

3	Cash and Cash Equivalents
	Cash at Bank		14,54,400

Question 103:

Visa Ltd. offered 10,000 shares of ₹100 each payable as follows: on application: ₹3, on allotment: ₹2, on first call: ₹3, on second call: ₹2. Public applied for 13,000 shares. Shares were allotted on pro rata to the applicants of 12,000 shares. All the shareholders have paid the amount up to allotment except Mohan, the allottee of 200 shares. His shares were forfeited. First call was then made. Forfeited shares were reissued @ ₹9 per share, ₹8 called-up. Second call has not yet been made. You are required to make the Cash Book and pass the Journal entries.

Answer:

Application	₹3
Allotment	₹2
First Call	₹3
Final call	₹2

Shares applied = 13,000 shares

Shares Issued = 10,000 shares

Books of Visa Ltd. Journal
Date	Particulars		L.F.	Debit (₹)	Credit (₹)
	Bank A/c	Dr.		39,000
	To Share Application A/c				39,000
	(Share application money received for 13,000 shares at ₹ 3 each)
	Share Application A/c	Dr.		39,000
	To Share Capital A/c (10,000×3)				30,000
	To Share Allotment A/c (2,000×3)				6,000
	To Bank A/c (1,000×3)				3,000
	(Share application of 10,000 shares transferred to Share Capital)
	Share Allotment A/c Dr.			20,000
	To Share Capital A/c				20,000
	(Share allotment due on 10,000 shares at ₹ 2 each)
	Bank A/c Dr.			13,720
	To Share Allotment A/c				13,720
	(Being Share allotment money received except 200 shares due on allotment)
	Share Capital A/c (200×5)	Dr.		1,000
	To Share forfeited A/c (200×3)				720
	To Share Allotment A/c (200×2) (Being 200 shares forfeited for non-payment of Allotment)				280
	Share First Call A/c	Dr.		29,400
	To Share Capital A/c				29,400
	(Being First call due on 9,800 shares at ₹ 3 each)
	Bank A/c			29,400
	To Share First Call A/c				29,400
	(Being amount receive on 9,800 shares for first call)
	Bank A/c (200×9)	Dr.		1,800
	To Share Capital A/c (200×8)				1,600
	To Securities Premium Reserve A/c				200
	(200×1)
	(Being 200 Share Re-issued at @₹9 called up @₹8)
	Bank A/c		Dr.
	To Share Capital A/c

	Share forfeited A/c Dr.			720
	To Capital Reserve A/c				720
	( Being balance in the forfeited amount of 200 shares transfer to capital reserve account)

Cash Book (Only Bank Column)
Dr.			Cr.
Particulars	Bank ( ₹)	Particulars	Bank ( ₹)
To Share Application A/c	39,000	By Share Application A/c	3,000
To Share Allotment A/c	13,720	By Balance C/d	80,920
To Share First Call A/c	29,400
To Share Capital A/c	1,600
To SPR A/c	200
	83,920		83,920

ass=MsoNormal style='margin-bottom:0cm;margin-bottom:.0001pt;line-height: normal'>Question 104:

Saregama Ltd. invited applications for issuing 80,000 equity shares of ₹100 each at a premium of ₹10. The amount was payable as follows:

On Application ₹30

On Allotment ₹30 (including a premium of ₹10)

On First Call ₹30

On Final Call Balance

Applications of 1,20,000 shares were received. Allotment was made on pro rata basis to all applicants. Excess money received on application was adjusted on sums due on allotment. Dhwani, who was allotted 1,600 shares, failed to pay allotment money and Sargam who applied for 6,000 shares did not pay first call money. These shares were forfeited immediately after first call. 2,000 of these shares (including all shares of Dhwani were issued to Tarang for ₹95 per share as ₹80 paid-up. Pass necessary Journal entries in books of Saregama Ltd. by opening Calls-in-Arrear and Calls-in-Advance Accounts, if final call has not been made.

(CBSE Sample Paper 2019)

Answer:

In the books of Saregama Ltd.
Journal
Date	Particulars		L.F.	Debit (₹)	Credit (₹)

	Bank A/c (1,20,000×30)	Dr.		36,00,000
	To Equity Share application A/c				36,00,000
	(Being share application money received)


	Equity Share application A/c	Dr.		36,00,000
	To Equity Share Capital A/c				24,00,000
	To Equity Share Allotment A/c (Being share application money transferred to share capital and allotment)				12,00,000

	Equity Share Allotment A/c (80,000 × 30)	Dr.		36,00,000
	To Equity Share Capital A/c (80,000 × 20)				16,00,000
	To securities premium reserve A/c (80,000 × 10)				8,00,000
	(Allotment money due)

	Bank A/c	Dr.		11,76,000
	Calls in arrears A/c	Dr.		24,000
	To Equity Share Allotment A/c				12,00,000
	(Allotment money received)

	Equity Share First Call A/c (80,000 × 3)	Dr.		24,00,000
	To Equity Share Capital A/c				24,00,000
	(Call money due)

	Bank A/c (1,60,000 × 2)	Dr.		22,32,000
	Calls in arrears A/c (1600×30)	Dr.		48,000
	Calls in arrears A/c (4000×30)	Dr.		1,20,000
	To Equity Share First Call A/c				24,00,000
	(Call money received)

	Equity Share Capital A/c	Dr.		1,28,000
	Securities premium reserve a/c	Dr.		16,000
	To Calls in arrears A/c (allotment)				24,000
	To Calls in arrears A/c (1600×30)				48,000
	To share forfeited A/c (2400×30)				72,000
	(Being shares of Dhanwani forfeited)

	Equity Share Capital A/c (400×95)	Dr.		38,000
	To Calls in arrears A/c (400×80)				32,000
	To share forfeited A/c (400×15)				6,000
	(Being shares of Dhanwani forfeited)


	Share forfeiture A/c [72,000+(400×50)]	Dr.		92,000
	To Capital Reserve A/c				92,000
	(Being balance of forfeiture transferred to Capital reserve)

Ts Grewal Solution 2025-2026

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Class 12 / Volume – 2

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Chapter 9- Company Accounts- Accounting for Share Capital