12th | Accounting for Share Capital | Question No. 49 To 52 | Ts Grewal Solution 2025-2026

Question 49:

Light Lamps Ltd. issued 50,000 shares of ₹10 each as fully paid-up to the promoters for their services to set-up the company. It also issued 2,000 shares of ₹10 each credited as fully paid-up to the underwriters of shares for their services. Journalise these transactions.

Answer:

Journal
Date	Particulars		L.F.	Debit (₹)	Credit (₹)

	Incorporation Expenses A/c	Dr.		5,00,000
	To Share Capital A/c (50,000×10)				5,00,000
	(Shares issued to promoters)

	Underwriting Commission A/c	Dr.		20,000
	To Underwriters’ A/c				20,000
	(Underwriting commission due)

	Underwriters’ A/c	Dr.		20,000
	To Share Capital A/c (2,000×10)				20,000
	(Shares issued to underwriters)

Forfeiture of Shares which were Issued at Par

Question 50:

Vikram Ltd. forfeited 5,000 shares of Rahul, who had applied for 6,000 shares for non-payment of allotment money of ₹5 per share and first and final call of ₹2 per share. Only application money of ₹3 was paid by him. Out of these, 3,000 shares were reissued ₹12 per share as fully paid.

Pass entries for forfeiture and reissue of shares. (CBSE Sample Paper 2023)

Answer:

Books of Vikram Ltd. Journal
Date	Particulars		L.F.	Debit (₹)	Credit (₹)
	Share capital A/c (5,000×10)	Dr.		50,000
	To Share forfeited A/c (6,000×3)				18,000
	To Share Allotment A/c				22,000
	To Share First and Final Call A/c				10,000
	(Being share forfeited for non-payment)
	Bank A/c	Dr.		36,000
	To Share capital A/c				36,000
	To Securities Premium Reserve A/c				6,000
	(Being shares reissued)
	Share forfeited A/c	Dr.		10,800
	To Capital Reserve A/c				10,800
	(Being balance in Share forfeited account of reissued share transferred)

Working notes:

Amount paid-up 18,000

Amount to be transferred to capital reserve = 18,000÷5000×3,000

Question 51:

Sangita Limited invited applications for issuing 60,000 shares of ₹10 each at par. The amount was payableas follows: on application ₹2 per share; on allotment₹3 per share; on first and final call ₹5 per share.Applications were received for 92,000 shares.

Allotment was made on the following basis: (a) to applicants for 40,000 shares: full; (b) to applicants for 50,000 shares: 40%; (c) to applicants for 2,000 shares: nil.

₹1,08,000 was realised on account of allotment (excluding the amount carried from application money)and ₹2,50,000 on account of call. The directors decided to forfeit shares of those applicants to whom fullallotment was made and on which allotment money was overdue.Pass Journal entries in the books of Sangita Limited to record the above transactions.

(CBSE Sample Paper 2013)

Answer:

Books of Sangita Limited Journal
Date	Particulars		L.F.	Debit (₹)	Credit (₹)

	Bank A/c	Dr.		1,84,000
	To Share Application A/c				1,84,000
	(Share application money received for 92,000 shares at ₹2 each)

	Share Application A/c	Dr.		1,84,000
	To Share Capital A/c				1,20,000
	To Share Allotment A/c				60,000
	To Bank A/c				4,000
	(Share application of 90,000 shares transferred to Share Capital, and excess adjusted on allotment and remaining amount returned)

	Share Allotment A/c	Dr.		1,80,000
	To Share Capital A/c				1,80,000
	(Share allotment due on 90,000 shares)

	Bank A/c	Dr.		1,08,000
	To Share Allotment A/c				1,08,000
	(Share allotment money received)

	Share capital A/c (4000×10)	Dr.		40,000
	To Share allotment A/c (4000×3)				12,000
	To Share First and Final Call A/c (4000×2) To Share Forfeiture A/c				20,000 8,000
	(4000 share forfeited)

Working notes;

Shares applied	Shares allotted	Application Money received	Share capital	Share allotment	Bank (Refund)
40,000	40,000	80,000	80,000	-	-
		40,000×2
50,000	20,000	1,00,000	40,000	60,000
		50,000×2
2,000	Nil	4,000	-	-	4,000
		2,000×2
92,000	90,000	1,84,000	1,20,000	60,000	4,000

Due on allotment 60,000×3

Transferred from application money

1,80,000

60,000

Money received on allotment

120,000

1,08,000

Calls in arrears

12,000

No. of shares on which allotment money not received 12000/3=4000 shares

Question 52:

Alpha Ltd. issued 20,000 Equity Shares of ₹10 each at par payable: On application ₹2 per share; on allotment ₹3 per share; on first call ₹3 per share; on second and final call ₹2 per share.Mr. Gupta was allotted 100 shares. Pass necessary Journal entry relating to the forfeiture of shares in each of the following alternative cases:

Case I:	If Mr. Gupta failed to pay the allotment money and his shares were immediately forfeited.
Case II:	If Mr. Gupta failed to pay allotment money and on his subsequent failure to pay the first call, his shares were forfeited.
Case III:	If Mr. Gupta failed to pay the first call and on his subsequent failure to pay the second and final call, his shares were forfeited.

Answer:

Application		₹	2
Allotment		₹	3
First Call		₹	3
Final Call		₹	2
			10
Books of Alpha Limited Journal
Date	Particulars				L.F.	Debit (₹)	Credit (₹)

Case I	Share Capital A/c (100×5)			Dr.		500
	To Share Forfeiture A/c						200
	To Share Allotment A/c						300
	(100 shares of ₹10 each, ₹5 called-up, forfeited for the non-payment of allotment)

Case II	Share Capital A/c (100 × 8)			Dr.		800
	To Share Forfeiture A/c						200
	To Share Allotment A/c						300
	To Share First Call A/c						300
	(100 shares of ₹10 each, ₹8 called-up forfeited for non-payment allotment and first-call)

Case III	Share Capital A/c			Dr.		1,000
	To Share Forfeiture A/c						500
	To Share First Call A/c						300
	To Share Final Call A/c						200
	(100 shares of ₹10 each forfeited for the non-payment ₹5 each)

Ts Grewal Solution 2025-2026

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Class 12 / Volume – 2

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Question 49:

Answer:

Forfeiture of Shares which were Issued at Par

Question 50:

Chapter 9- Company Accounts- Accounting for Share Capital