Company Accounts

Share Capital

1
1) Murali Krishna Ltd. Invited applications for 50,000
shares Rs.10 each at a premium of Rs 2 per share. The
amount on shares was payable as
Rs.5 on application,
Rs.4 on Allotment (including premium)
Balance on first and final call.
Application received for 82,500 shares and 20,000
Applications were totally rejected and money refunded.
Remaining applicants were alloted on pro-rata basis. Excess
application money was to be adjusted against allotment.
Nishant
who had applied for 1,250 shares failed to pay the amount
due on allotment and call. The Company forfeited his shares
& reissued 500 shares at Rs.11 per share as fully paid. 2Pass
 Application
Date Particulars L.F Debit Credit
1 Bank A/c Dr. (82,500 X 5) 4,12,500
To Share Application A/c 4,12,500
(Being Share Application money
received)
Share Application A/c Dr. 4,12,500
2 To Share Capital A/c (50,000 X 2,50,000
5) 62,500
To Share Allotment A/c
(12,500 X 5) 1,00,000
To Bank A/c (20,000 X 5)
(Being share allotted and amount 3
adjusted)
 Allotment
Date Particulars L.F Debit Credit
3 Share Allotment A/c Dr. (50,000 X 4) 2,00,000
To Share Capital A/c (50,000 X 1,00,000
2) 1,00,000
To Securities Premium A/c
(50,000 X 2)
4 (Being Allotment money due ) 1,34,750
2,750
Bank A/c Dr.
1,37,500
Calls-in-Arrears A/c Dr.
To Share Allotment A/c
(Being Share Allotment money
4
received except 1,000 Shares)
 First
First Call
Call
Date Particulars L.F Debit Credit
(Rs.) (Rs.)
5 Share First and Final Call A/c Dr. 1,50,000
To Share Capital A/c (50,000 X 3) 1,50,000
(Being Share First and Final Call
money due)
6 Bank A/c Dr. (49,000 X 3) 1,47,000
Calls-in-Arrears A/c Dr. (1,000 X 3) 3,000
To Share First and Final Call A/c 1,50,000
(Being Share First and Final Call
money received except 1,000 Shares)
5
 Forfeiture
Forfeiture and
and Reissue
Reissue
Date Particulars L.F Debit Credit
7 Share Capital A/c Dr. (1,000 X 10) 10,000
Securities Premium A/c Dr. (1,000 X 2) 2,000
To Share Forfeiture A/c 6,250
To Calls-in-Arrears A/c (2,750 + 5,750
3,000)
(Being shares are forfeited for non-
8 payment of Allotment and First Call) 5,500
5,000
Bank A/c Dr. (500 X 11)
500
To Share Capital A/c (500 X 10)
To Securities Premium A/c (500 X
1) 6
(Being Forfeited Shares are Re-issue at
 Capital
Capital Reserve
Reserve
Date Particulars L.F Debit Credit
(Rs.) (Rs.)
    9 Share Forfeiture A/c Dr. 3,125
To Capital Reserve A/c 3,125
(Being balance in Share Forfeiture A/c
transfer to Capital Reserve on 500 Shares)
Note:
Application time 1,250 x 5 = 6250 we got,
but we alloted 1,000 shares and forfeited.
Now we re-issue 500 Shares. So half of the
forfeited amount transfer to Capital
Reserve. 7
N. Bala Murali
Krishna