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Accountancy · 2025 · 6 marks
CBSE 2025 · Region 2 · Set 2 · Q24
Alexia Limited invited applications for issuing 1,00,000 equity shares of ₹ 10 each at premium of ₹ 10 per share. The amount was payable as follows:…
Alexia Limited invited applications for issuing $\displaystyle 1,00,000$ equity shares of ₹ $\displaystyle 10$ each at premium of ₹ $\displaystyle 10$ per share. The amount was payable as follows : On application ₹ $\displaystyle 9$ per share (Including premium ₹ $\displaystyle 6$ per share) On allotment ₹ $\displaystyle 8$ per share (Including premium ₹ $\displaystyle 4$ per share) On first and final call ₹ $\displaystyle 3$ per share. Applications were received for $\displaystyle 1,50,000$ equity shares and allotment was made to the applicants as follows : Category A : Applicants for $\displaystyle 90,000$ shares were allotted $\displaystyle 70,000$ shares. Category B : Applicants for $\displaystyle 60,000$ shares were allotted $\displaystyle 30,000$ shares. Excess money received on application was adjusted towards allotment and first and final call. Shekhar, who had applied for $\displaystyle 1200$ shares failed to pay the first and final call. Shekhar belonged to category B. Pass necessary journal entries for the above transactions in the books of Alexia Limited. Open calls in arrears and calls in advance account, wherever necessary.
Pass the necessary journal entries for forfeiture and reissue of shares in the following cases : (i) Premier Ltd. forfeited $\displaystyle 600$ shares of ₹ $\displaystyle 10$ each issued at a premium of ₹ $\displaystyle 3$ per share (payable with allotment) for non- payment of allotment money of ₹ $\displaystyle 7$ per share including premium. The first and final call of ₹ $\displaystyle 3$ per share was not yet made. The forfeited shares were reissued at ₹ $\displaystyle 13$ per share fully paid up . (ii) Risha Ltd. forfeited $\displaystyle 1000$ shares of ₹ $\displaystyle 10$ each, ₹ $\displaystyle 8$ per share called up issued at a premium of ₹ $\displaystyle 2$ per share to Atul, for non-payment of allotment money of ₹ $\displaystyle 6$ per share (including premium). Out of these, $\displaystyle 800$ shares were reissued at ₹ $\displaystyle 7$ per share, $\displaystyle 5$ $\displaystyle 8$ paid up.
Marking-scheme solution
Books of Alexia Ltd.
Journal
Date Particulars L.F. Dr. Cr.
Amount Amount
(₹) (₹)
Bank A/c Dr. $\displaystyle 13,50,000$
To Equity Share Application A/c $\displaystyle 13,50,000$
(Application money received on $\displaystyle 1,50,000$ shares @₹$\displaystyle 9$
per share, including premium ₹$\displaystyle 6$)
Equity Share Application A/c Dr. $\displaystyle 13,50,000$
To Equity Share Capital A/c $\displaystyle 3,00,000$
To Securities Premium A/c $\displaystyle 6,00,000$
To Equity Share Allotment A/c $\displaystyle 4,20,000$
To Calls in advance A/c $\displaystyle 30,000$
(Transfer of application money to share capital,
securities premium, allotment and calls)
Equity Share Allotment A/c Dr. $\displaystyle 8,00,000$
To Equity Share Capital A/c $\displaystyle 4,00,000$
To Securities Premium A/c $\displaystyle 4,00,000$
(Amount due on allotment)
Bank A/c Dr. $\displaystyle 3,80,000$
To Equity Share Allotment A/c $\displaystyle 3,80,000$
(Amount received on allotment)
Equity Share First and Final call A/c Dr. $\displaystyle 3,00,000$
To Equity Share Capital A/c $\displaystyle 3,00,000$
(Amount due on share first and final call)
Bank A/c Dr. $\displaystyle 2,68,800$
Calls in arrears A/c Dr. $\displaystyle 1,200$
Calls in advance A/c Dr. $\displaystyle 30,000$
To Equity Share First and Final Call A/c $\displaystyle 3,00,000$
(Amount received on share first and final call except on
$\displaystyle 600$ shares)
Q. (b) Pass the necessary journal entries for forfeiture and reissue…
Ans. (i)
Books of Premier Ltd.
Journal
Date Particulars L.F. Dr. Cr.
Amount Amount
(₹) (₹)
Share Capital A/c Dr. $\displaystyle 4,200$
Securities Premium A/c Dr. $\displaystyle 1,800$
To Share Forfeiture A/c $\displaystyle 1,800$
To Share Allotment A/c / Calls in arrears A/c $\displaystyle 4,200$
($\displaystyle 600$ shares forfeited for non-payment of allotment money)
Bank A/c Dr. $\displaystyle 7,800$
To Share Capital A/c $\displaystyle 6,000$
To Securities Premium A/c $\displaystyle 1,800$
(All forfeited shares reissued @₹$\displaystyle 13$ per share fully paid up)
Share Forfeiture A/c Dr. $\displaystyle 1,800$
To Capital Reserve A/c $\displaystyle 1,800$
(Profit on reissue of forfeited shares transferred to capital
reserve)
(ii)
Books of Risha Ltd.
Journal
Date Particulars L.F. Dr. Cr.
Amount Amount
(₹) (₹)
Share Capital A/c Dr. $\displaystyle 8,000$
Securities Premium A/c Dr. $\displaystyle 2,000$
To Share Forfeiture A/c $\displaystyle 4,000$
To Share Allotment A/c/ Calls in arrears A/c $\displaystyle 6,000$
($\displaystyle 1,000$ shares forfeited for non-payment of allotment
money)
Bank A/c Dr. $\displaystyle 5,600$
Share Forfeiture A/c Dr. $\displaystyle 800$
To Share Capital A/c $\displaystyle 6,400$
(Reissue of $\displaystyle 800$ shares @₹$\displaystyle 7$ per share ₹$\displaystyle 8$ paid up)
Share Forfeiture A/c Dr. $\displaystyle 2,400$
To Capital Reserve A/c $\displaystyle 2,400$
(Profit on reissue of forfeited shares transferred to capital
reserve)
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