Q 109 DK Goel Issue of Shares Solutions Class 12 CBSE (2024-25)

Solution of Question number 109 of Accounting for Companies Issue of shares chapter 6 of DK Goel Class 12 CBSE (2024-25)

X Ltd. invited applications for issuing 5,00,000 equity shares of ₹ 10 each at par. The amount per share was payable as follows:

On Application ₹ 1 per share

On Allotment ₹ 2 per share

On First Call ₹ 3 per share

On Second and Final Call – Balance

Applications for 8,00,000 shares were received. Applications for 1,00,000 shares were rejected and pro-rata allotment was made to the remaining applicants. Excess money received with applications were adjusted towards sums due on allotment. All calls were made. Ashok, a shareholder holding 5,000 shares failed to pay the allotment and the call money. Mohan, a shareholder who had applied for 7,000 shares, failed to pay the first and second and final call. Shares of Ashok and Mohan were forfeited after the second and final call. Of the forfeited shares 8,000 shares were re-issued at ₹ 12 per share fully paid up. The re-issued shares included all the forfeited shares of Ashok.

Pass necessary journal entries for the above transactions in the books of X Ltd.

[Ans. Amount received on Allotment ₹ 7,92,000; Capital Reserve ₹ 16,000.]

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