question_answer

Makkar Ltd was registered with an authorised capital of Rs. 20,00,000 in Rs. 10 per equity share. It invited applications for issuing 1,00,000 equity shares at a premium of Rs. 2 per share. The amount was payable as follows:

On application	Rs. 4 Per Share (Including premium)
On allotment	Rs. 3 Per Share
On first and final call	balance amount

Applications were received for 1,30,000 shares. Applications for 10,000 shares were rejected and the application money received on them was refunded. Pro-rata allotment was made to the remaining applications. Amount overpaid on these applications was adjusted towards the amount due on allotment. Raj, who had applied for 1,200 shares, failed to pay the allotment and call money. The company forfeited his shares, out of which 800 shares were re-issued to Mohan at Rs. 9 per share fully paid up. You are required to (i) Pass the journal entries in the books of the company through calls-in-arrears account. (ii) Prepare the share allotment account. Or Gupta Ltd made an issue of 1,00,000 equity shares of Rs. 10 each, payable as follows On application Rs. 2.50 per share; on allotment ? 2.50 per share and balance amount on first and final call. Members holding 400 shares did not pay the call money and their shares were duly forfeited. 200 of the forfeited shares were reissued as fully paid at Rs. 5 per share. Draft necessary journal entries and prepare share capital and forfeited shares accounts in the books.

Answer:

Amount received at allotment = Rs. 2,17,800 Capital reserve = Rs. 1,440