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Accountancy · 2023 · 6 marks
CBSE 2023 · Region 1 · Set 2 · Q24
Pass necessary journal entries for the forfeiture and reissue of shares in the following cases: (i) BCG Limited forfeited 75 shares of ₹ 10 each…
Pass necessary journal entries for the forfeiture and reissue of shares in the following cases : (i) BCG Limited forfeited $\displaystyle 75$ shares of ₹ $\displaystyle 10$ each issued at a premium of ₹ $\displaystyle 4$ per share for non - payment of allotment money of ₹ $\displaystyle 8$ per share (including premium). The first and final call of ₹ $\displaystyle 4$ per share was not made. The forfeited shares were reissued at ₹ $\displaystyle 15$ per share fully paid. (ii) Geetika Limited forfeited $\displaystyle 1,200$ shares of ₹ $\displaystyle 50$ each issued at par for non-payment of final call of ₹ $\displaystyle 10$ per share. Out of these, $\displaystyle 900$ shares were reissued at ₹ $\displaystyle 45$ per share fully paid - up.
Pushkar Limited invited applications for $\displaystyle 30,000$ shares of ₹ $\displaystyle 100$ each at $\displaystyle 20$% premium. The amount per share was payable as under : On application ₹ $\displaystyle 40$ (including ₹ $\displaystyle 10$ premium) On allotment ₹ $\displaystyle 30$ (including ₹ $\displaystyle 10$ premium) On first call ₹ $\displaystyle 30$ On second and final call Balance Applications were received for $\displaystyle 40,000$ shares and pro - rata allotment was made to the applicants for $\displaystyle 35,000$ shares, the remaining applications being refused. Excess application money was adjusted towards sums due on allotment. Yogesh, who applied for $\displaystyle 700$ shares, failed to pay the allotment money and his shares were forfeited immediately after allotment. First call was made thereafter and all the money due on first call was received. The second and final call was not made. Pass necessary journal entries for the above transactions in the books of Pushkar Limited.
Marking-scheme solution
(a)(i)
Books of BCG Limited
Journal
Date Particulars L.F Debit Credit
Amount Amount
(₹) (₹)
Share Capital A/c Dr. $\displaystyle 450$
Securities Premium/ Securities Premium
Reserve A/c Dr. $\displaystyle 300$
To Forfeited Shares A/c $\displaystyle 150$
To Share Allotment/Calls in Arrears A/c $\displaystyle 600$
($\displaystyle 75$ shares forfeited for non-payment of allotment)
Bank A/c Dr. $\displaystyle 1,125$
To Share Capital A/c $\displaystyle 750$
To Securities Premium/Securities Premium $\displaystyle 375$
Reserve A/c
($\displaystyle 75$ shares re-issued at ₹$\displaystyle 15$ per share, fully paid up)
Forfeited Shares A/c Dr. $\displaystyle 150$
To Capital Reserve A/c $\displaystyle 150$
(Gain on $\displaystyle 75$ re-issued shares transferred to capital
reserve)
(ii)
Books of Geetika Limited
Journal
Date Particulars L.F Debit Credit
Amount Amount
(₹) (₹)
Share Capital A/c Dr. $\displaystyle 60,000$
To Forfeited Shares A/c $\displaystyle 48,000$
To Share Final Call / Calls in Arrears A/c $\displaystyle 12,000$
($\displaystyle 1,200$ shares forfeited for non-payment of final call)
Bank A/c Dr. $\displaystyle 40,500$
Forfeited shares A/c Dr. $\displaystyle 4,500$
To Share Capital A/c $\displaystyle 45,000$
($\displaystyle 900$ shares re-issued at ₹$\displaystyle 45$ per share, fully paid up)
Forfeited Shares A/c Dr. $\displaystyle 31,500$
To Capital Reserve A/c $\displaystyle 31,500$
(Gain on $\displaystyle 900$ re-issued shares transferred to capital
reserve)
Q. (b) Pushkar Limited invited……….
Ans. (b) Books of Pushkar Limited
. Journal
Date Particulars L.F Debit Credit
Amount Amount
(₹) (₹)
Bank A/c Dr. $\displaystyle 16,00,000$
To Share Application A/c $\displaystyle 16,00,000$
(Application money received on $\displaystyle 40,000$ shares)
Share Application A/c Dr. $\displaystyle 16,00,000$
To Share Capital A/c $\displaystyle 9,00,000$
To Securities Premium/Securities Premium $\displaystyle 3,00,000$
Reserve A/c
To Share Allotment A/c $\displaystyle 2,00,000$
To Bank A/c $\displaystyle 2,00,000$
(Transfer of application money on $\displaystyle 30,000$ shares to
Share Capital account, on $\displaystyle 5,000$ shares to Allotment
account, and of $\displaystyle 5,000$ shares refunded)
$\displaystyle 9,00,000$
Share Allotment A/c Dr.
$\displaystyle 6,00,000$
To Share Capital A/c
$\displaystyle 3,00,000$
To Securities Premium/Securities Premium
Reserve A/c
(Money due on allotment on $\displaystyle 30,000$ debentures)
$\displaystyle 6,86,000$
Bank A/c Dr.
$\displaystyle 14,000$
Calls in Arrears A/c Dr.
To Share Allotment A/c
$\displaystyle 7,00,000$
(Money received on share allotment)
$\displaystyle 6,86,000$
Bank A/c Dr.
To Share Allotment A/c $\displaystyle 6,86,000$
(Money received on share allotment)
$\displaystyle 30,000$
Share Capital A/c Dr.
$\displaystyle 6,000$
Securities Premium/Securities Premium Reserve A/c Dr.
To Forfeited Shares A/c $\displaystyle 22,000$
To Calls in Arrears A/c/ Share Allotment A/c $\displaystyle 14,000$
(Forfeiture of $\displaystyle 600$ shares for non-payment of
allotment money)____________________________
$\displaystyle 8,82,000$
Share First Call A/c Dr.
To Share Capital A/c $\displaystyle 8,82,000$
(First call amount due on $\displaystyle 29,400$ shares)
Bank A/c Dr.
$\displaystyle 8,82,000$
To Share First Call A/c
(Money received on first call) $\displaystyle 8,82,000$
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CBSE Class 12 Accountancy past-paper question from the 2023 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.