Q 120 DK Goel Issue of Shares Solutions Class 12 CBSE (2024-25)

Solution of Question number 120 of Accounting for Companies Issue of shares chapter 6 of DK Goel Class 12 CBSE (2024-25)

Ganesh Ltd. issued a prospectus inviting applications for 20,000 shares of ₹ 10 each at a premium of ₹ 4 per share, payable as follows:

On Application	₹ 4 (including Premium ₹ 1)
On Allotment	₹ 3 (including Premium ₹ 1)
On First Call	₹ 3 (including Premium ₹ 1)
On Second and Final Call	₹ 4 (including Premium ₹ 1)

Applications were received for 30,000 shares and pro-rata allotment was made on the applications for 24,000 shares. It was decided to utilise excess application money towards the sums due on allotment.

X, who was allotted 500 shares, failed to pay the allotment money and on his subsequent failure to pay the first call, his share were forfeited.

Y, who applied for 1,800 shares, failed to pay the two calls and his shares were forfeited after the second call.

Of the shares forfeited, 1,700 shares were re-issued as fully paid up for ₹ 8 per share, the whole of Y’s share being included.

Prepare Cash Book, Journal and Balance Sheet.

[Ans. Cash at bank ₹ 2,78,500; Cash received on allotment ₹ 42,900; Balance of Share Forfeiture A/c ₹ 1,140; Capital Reserve ₹ 4,860; Balance of Securities Premium A/c ₹ 75,500; Total of Balance Sheet ₹ 2,78,500.]

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