Dell Ltd. forfeited 2,000 Equity Shares of  ₹50 each issued at 10% premium on which allotment money of ₹15 per equity share (including premium) and first call of  ₹15 per share were not received, the second and final call of  10 per equity share was not yet called.

Calculate 'Discount Allowed or Premium Received' and 'Amount transferred to Capital Reserve' on reissue of  shares as fully paid-up in each of  the following cases: ₹45 per share.

Case 1. If 200 of  these shares were reissued as ₹40 paid-up for ₹45 per share.

Case 2. If 200 of  these shares were reissued as ₹40 paid-up for ₹40 per share.

Case 3. If 200 of  these shares were reissued as ₹40 paid-up for ₹35 per share.

Case 4. If 200 of  these shares were reissued as ₹40 paid-up for ₹25 per share.

Case 5. If 200 of  these shares were reissued at ₹35 per share as fully paid-up.

Case 1. If 200 of  these shares were reissued as ₹40 paid-up for

Premium received - ₹1,000

And Amount transferred to Capital Reserve -₹3.000-

 

Case 2. If 200 of  these shares were reissued as ₹40 paid-up for ₹40 per share.

Discount or Premium - Nil

And Amount transferred to Capital Reserve - ₹3,000.

 

Case 3. If 200 of  these shares were reissued as ₹40 paid-up for ₹35 per share.

Discount Allowed - ₹1,000

And Amount transferred to Capital Reserve - ₹2,000

 

Case 4. If 200 of  these shares were reissued as ₹40 paid-up for ₹25 per share.

Case 4: Discount Allowed₹3,000

And Amount transferred to Capital Reserve - Nil.

 

Case 5. If 200 of  these shares were reissued at ₹35 per share as fully paid-up.

Discount Allowed₹3,000

And Amount transferred to Capital Reserve - Ni1

 

(i) 3,000 shares of  ₹10 each of  Rakesh were forfeited by crediting ₹5,000 to Forfeited Shares Account.

Out of  these, 1,800 shares were reissued to Mohan for ₹9 per share as fully paid-up.

(ii) Z Ltd. forfeited 20 shares of  ₹100 each (₹60 called-up) issued at par to Shiv on which he paid ₹20 per share. Out of  these, 15 shares were reissued to Rajesh as ₹60 paid-up for ₹45 per share.

 

Situations	Gain on Re-Issue of  forfeited shares
1	₹1200
2	₹75

 

Notes :

Case 1: 1,800 shares were reissued to Mohan at ₹1 discount

Total discount on  1,800 shares were ₹1,800

Amount forfied for 1,800 shares is ₹3,000

Amount left after discount to be transferring to capital reserve is ₹3,000-1,800=₹1,200

Case 2: discount per share is ₹5 on re-issue

Total discount on re-issue is 15×15=225

Amount forfied for 15 shares is 15×20=300

Amount left after discount to be transferring to capital reserve is ₹300-225=₹75

 

Forfeiture and Reissue of  Shares which were issued at Par

A company forfeited 4,000 shares of  ₹10 each fully called-up, on which application money of ₹3 each has been paid. Out of  these, ₹2,000 shares were reissued as fully paid-up for ₹18,000.

Pass necessary Journal entries for above transactions. (CBSE 2023)

Journal
Date	Particulars	L.F.	Debit  (₹)	Credit  (₹)
	Share Capital A/c  (4,000×10)    Dr.		40,000
	To Forfeited Shares A/c (4,000×3)			12,000
	To Calls-In-Arrears A/c (4,000×7)			28,000
	(Being share forfeited for non-Payment of  remaining Calls of  400 shares)
	Bank A/c                   Dr.		18,000
	Forfeited Shares A/c              Dr.		2,000
	To Share Capital A/c  (2,000×10)			20,000
	(Being 2,000 shares forfeited reissued as fully paid-up)
	Forfeited Shares A/c              Dr.		4,000
	To Capital Reserve A/c			4,000
	(being balance in Forfeited Shares account of  reissued shares transferred to Capital Reserve 12,000×2,000÷4,000= 6,000-2,000=4,000)

 

Alfa Ltd. forfeited 900 Equity Shares of  ₹100 each for the non-payment of  allotment money of  ₹30 per share and the first call of  ₹20 per share. The second and final call of  ₹25 per share has not been made . The forfeited shares were reissued for ₹90 per share , ₹75 paid-up. Journalise the above.

Application	25	Balancing Figure
Allotment	30
First Call	20
Final Call	25	Un-called
	100

Called-up ₹75 per share

Books of  X Limited Journal
Date	Particulars		L.F.	Debit  ₹	Credit  ₹
	Equity Share Capital A/c (900×75)	Dr.		67,500
	To Share Forfeiture A/c				22,500
	To Calls-in-Arrears A/c				45,000
	(900 shares of  ₹100 each ₹75 called-up, forfeited for the non-payment sum of  allotment ₹30 and first call ₹20 per share)
	Bank A/c	Dr.		81,000
	To Share Capital A/c				67,500
	To Securities Premium A/c				13,500
	(900 shares of  ₹100 each re-issued as ₹75 paid-up for ₹90 each)
	Share Forfeiture A/c	Dr.		22,500
	To Capital Reserve A/c				22,500
	(Balance of  Share Forfeiture Account after re-issue, transferred to Capital Reserve Account)

 

Working Notes-

 

Share forfeiture account credit	=	Share application money received for 900shares
	=	900×25 ₹.
	=	22,500
Calculation of  capital reserve
Share forfeiture account credit	=	22,500
Share forfeiture account debit	=	Nil
Capital reserve	=	22,500