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Question no 79 Chapter 1- Class 12 Part 2 Unimax
M/s Reliable investment issue a prospectus inviting application of ₹ 4,000 equity share of ₹ 20 each at a premium of ₹ 4 per shares payable as under:
| On application | ₹ 4 per share |
| On allotment | ₹ 10 per share (including premium) |
| On first | ₹ 6 per share |
| On second call | ₹ 4 per share |
Application were received for 6,000 shares and allotment was made pro-rata to the applicants of 4,800 shares, the applications for remaining shares being refused. Money overpaid on application was used on account of sums due on allotment.
Harish to whom 80 shares were allotted were allotted, could not pay the allotment money and on his subsequent failure to pay the first call his shares were forfeited after the first call.
Mukesh to whom 120 shares were allotted, failed to pay the two calls and hid shares were forfeited after the second call.
Of the shares forfeited, 160 share were sold to Suresh credited as fully paid at ₹ 10 per shares, all of Harish’s forfeited shares being included.
Pass journal entries in the books of the company to record the above transactions.
The solution of Question no 79 Chapter 1- Class 12 Part 2 Unimax: –
Journal
Books of Sakshi
| Date | Particulars | L.F. | Debit | Credit | |
| Bank A/c | Dr. | 24,000 | |||
| To Equity share application A/c | 24,000 | ||||
| (Being application money received on 6000 shares @ ₹ 4 each) | |||||
| Equity Share application A/c | Dr. | 24,000 | |||
| To Equity share capital A/c | 16,000 | ||||
| To Equity share allotment A/c | 3200 | ||||
| To bank A/c | 4800 | ||||
| (Being application money transferred to capital a/c on 4000 shares and share allotment on 800 shares & balance amount on 1200 shares refunded) | |||||
| Equity share allotment A/c | Dr. | 40,000 | |||
| To Equity shares capital A/c | 24,000 | ||||
| To Securities premium reserve A/c | 16,000 | ||||
| (Being allotment money due on 4,000 equity shares @ ₹ 10 per share including 4 premium) | |||||
| Bank A/c | Dr. | 36,064 | |||
| To Equity share allotment A/c | 36,064 | ||||
| (Being received on allotment money) | |||||
| Equity share 1st call A/c | Dr. | 24,000 | |||
| To Equity shares capital A/c | 24,000 | ||||
| (Being first call money due on 4000 equity shares @ ₹ 6 per shares) | |||||
| Bank A/c | Dr. | 22,800 | |||
| To Equity shares 1st call A/c | 22,800 | ||||
| (Being first call money received on 3800 shares @ ₹ 6 per share) | |||||
| Equity share capital A/c | Dr. | 1280 | |||
| Securities premium A/c | Dr. | 320 | |||
| To Equity share allotment A/c | 736 | ||||
| To Equity first call A/c | 480 | ||||
| To Share forfeited A/c | 384 | ||||
| (Being 80 shares of Mr. Harish forfeited due to non-payment of allotment and first call money) | |||||
| Equity share second call A/c | Dr. | 15,680 | |||
| To Equity shares capital A/c | 15,680 | ||||
| (Being second call money due on 3920 equity shares @ ₹ 4 per share) | |||||
| Bank A/c | Dr. | 15,200 | |||
| To Equity share second call A/c | 15,200 | ||||
| (Being second call money received on 3800 equity shares @ ₹ 4 per share) | |||||
| Equity share capital A/c | Dr. | 15,200 | |||
| To Equity share first call A/c | 720 | ||||
| To Equity share forfeited A/c | 1200 | ||||
| To Equity share second call A/c | 480 | ||||
| (Being 120 equity shares of Mukesh forfeited due to non-payment of first call and second call) | |||||
| Bank A/c | Dr. | 2,880 | |||
| Share forfeited A/c | Dr. | 320 | |||
| To Equity share capital A/c | 32,000 | ||||
| (Being 160 forfeited shares reissued @ ₹ 18 per share as fully paid up) | |||||
| Share forfeited A/c | Dr. | 864 | |||
| To capital reserve A/c | 864 | ||||
| (Being forfeited amount transfer to capital reserve) | |||||
Working Note:
| Shares applied | Shares allotted | |
| Lot 1 | 4800 | 4000 |
| Lot 2 | 1200 | nil |
| 6000 | 4000 |
1 Table showing adjustment of excess amount received on application.
| Lot 1 | Lot 2 | total | |
| No. of shares applied | 4800 | 1200 | 6000 |
| Less: no. of shares allotted | 4800 | nil | 4000 |
| Over subscription | 800 | 1200 | 2000 |
| ₹ | ₹ | ₹ | |
| Excess amount received on application @ ₹4 per share | 3200 | 4800 | 8000 |
| Less: amount adjusted on allotment @ ₹10 per share | 3200 | nil | 3200 |
| Refunded to be made | nil | 4800 | 4800 |
2 Calculation of net amount Received on allotment
| No. of shares allotted to Mr. Harish =80 | |
| No. of shares Applied by Mr. Harish = 800 x 4800/4000 | =96 per shares |
| ₹ | |
| Application money received from Mr. Harish on 96 shares=(96 x 6) | 384 |
| Less: actual application amount on 80 shares (80 x 4) | 320 |
| Excess Application money Adjustment towards Allotment | 64 |
| ₹ | |
| Amount due From Mr. Harish on allotment = 80 x 10 =800 | |
| Less: Excess Application money adjusted = 64 | |
| Amount not paid by Mr. Harish | 736 |
| ₹ | |
| Total amount due on allotment = 4000 x 10 = | 40,000 |
| Less : Application money Adjusted | 32000 |
| 36800 | |
| Less : Amount not paid by Mr. Harish | 736 |
| Net Amount received on allotment | 36064 |
3 Calculation of Net Amount received on first call
| ₹ | |
| Total amount due on first call (4000 x 6) | 24000 |
| Less : Calls in Arrear (₹) | |
| Mr. Harish (80 shares x 6) | 480 |
| Mr. Mukesh (120 shares x 6)720 | 1200 |
| Net amount received on first call | 22800 |
4 Calculation of amount to be transferred to Capital Reserve A/c
| Amount forfeited on 120 share held by of Mr. Mukesh =₹ 1200 | |
| ₹ | |
| Amount forfeited on 80 share held by of Mr. Mukesh =₹ 1200/120 x80 = | 800 |
| Amount forfeited on 80 share of Mr. Mukesh = | ₹ 800 |
| Amount forfeited on 80 share of Mr. Harish = | 384 |
| Total Amount forfeited on 160 shares = | 1184 |
| Less : Discount Allowed on Reissued share = | 320 |
| Balance Credited to Capital Reserve A/c | 864 |
End of Solution
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UnimaxSolutions.in offers a comprehensive solution for students studying Advanced Accountancy Part 1 in Class 12. With their meticulously curated study material, students can access comprehensive solutions to all the questions in each chapter. By selecting the chapter name from the study material, students can easily navigate through the topics and find detailed explanations and step-by-step solutions to the problems presented in that section. Whether it’s understanding complex accounting concepts, mastering calculation techniques, or analyzing financial statements, Unimax provides a valuable resource to aid students in their learning journey. With these comprehensive solutions at their disposal, students can enhance their understanding, clarify doubts, and improve their problem-solving skills in Advanced Accountancy, ensuring they are well-prepared for their Class 12 examinations.
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- Chapter No. 4 – Financial Statements of a Company (Balance Sheet Only)
- Chapter No. 5 -Financial Statement Analysis
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