Chapter – 9, Company Accounts - Accounting for Share Capital

EXERCISE

DISCLOSURE of Share Capital in Company's Balance Sheet

1. Hi-tech Ltd. was registered with an authorized capital of t ₹50,00,000 divided into Equity Shares 100 each. The company offered for public
subscription all the shares. Applications were received for 45,000 shares and allotment were made to all the applicants. All the calls were
made and were duly received except the final call of ₹20 per share on 500 shares. Prepare the Balance Sheet of the company showing the
Share Capital.
2. Farm Products Ltd. has authorized share capital of ₹50,00,000 divided into 5,00,000 Equity Shares off 10 each. It has existing issued and
paid-up capital on 5,00,000. It further issued to public 1,50,000 Equity Shares at par for subscription payable as under: On Application ₹3,
On Allotment ₹4, and On Call Balance Amount. The issue was fully subscribed, and allotment was made to all the applicants. Call was
made during the year and was duly received. Show Share Capital in the Balance Sheet of the company.
3. Global Trade Ltd. has authorized share capital of ₹1,00,00,000 divided into 1,00,000 Equity Shares Of ₹100 each. It has existing issued and
paid-up capital of ₹25,00,000. It further issued 25,000 Equity Shares at a premium of 20% for subscription payable as under:
On Application… ₹30,
On Allotment… ₹60, and
On Call… Balance Amount

The issue was fully subscribed, and allotment was made to all the applicants the company did not make the call during the year.

Show Share Capital in the Balance Sheet of the company.

4. Star Ltd. Is registered with capital of ₹5000000 divided into 50000 equity shares of ₹100 each. The Company issued 25000 equity shares
for subscription. Subscription was received for 23750 shares and all the due amount was duly received, except the first and final call of
₹20 per share on 600 shares. Show the share capital in the balance sheet of the company.

Issue of Shares of Cash at Par

5. Grand marketing ltd. issued 2,50,000 equity shares of ₹10 each to public. All amounts have been received in lump sum. Pass journal
entries in the books of the company.
6. authorized capital of ₹1600000 of Bharat Ltd. is divided into 160000 equity shares of ₹10 each. Out of these shares, 80,000 equity shares
were issued at par to public for subscription. The full nominal value is payable on application. All the shares were subscribed. Pass
necessary journal entries in the books of the company.
7. Akanksha Leathers Ltd. invited applications for 10,000 shares ₹100 payable as ₹20 on application, ₹30 on allotment on ₹20 first call and
the balance on final call.
All the shares were applied and allotted. All the money was duly received.
You are required to journalize these transactions.
8. National textiles Ltd. authorized capital of ₹300000 divided into 3000 shares of ₹100 each, which word offered to the public. amount
payable as ₹30 per share on application ₹40 per share on allotment and ₹30 per share on 1st and final call these shares fully subscribed
and all those were duly received. prepare the cash book and journal.
9. Modern Dairies Ltd. was registered with an authorized capital of' 10,00,000 divided into 7,500 Equity Shares of ₹100 each and 2,500
Preference Shares of ₹100 each. 1,000 Equity Shares and 500; 9% Preference Shares were offered to public on the following terms-Equity
Shares payable ₹1O on application, ₹40 on allotment and the balance in two calls of ₹25 each. Preference Shares are payable ₹25 on
application, ₹25 on allotment and ₹50 on first and final call. All the shares were applied for and allotted. Amount due was duly received.
Prepare Cash Book and pass necessary Journal entries to record the above issue of shares and show how the Share Capital will be shown
in the Balance Sheet.

Issue of Shares for Cash at Premium

10. Premio Ltd. issued 50,000 Equity Shares of ₹100 each at a premium of ₹50 per share, payable as follows:
₹100 per share on Application; and ·
Balance on Allotment.
The issue was subscribed, and shares were issued to the applicants. Pass the necessary Journal entries.
11. Seema Ltd. offered for subscription 10,000 shares of ₹25 each, payable ₹5 per share on application,
₹1O per share on allotment (including ₹5 per share as premium), ₹5 per share as first call on the shares and the balance in two equal
amounts at intervals of three months. All the shares were applied for and allotted. All the money was received except the second call and
final call on 200 and 400 shares respectively.
 Pass the entries in the company's Journal, Cash Book, and the Ledger. Also show the company's Balance Sheet on completion of the
above transactions.
12. Bharat Ltd. was incorporated with a capital of ₹2,00,000 divided into shares of ₹1O each. 2,000 shares were offered for subscription and
out of these, 1,800 shares were applied for and allotted. ₹3 per share (including ₹1 premium) was payable on application, ₹4 per share
(including ₹1 premium) on allotment, ₹2 per share on first call and ₹3 per share on final call. All the money was received. Give necessary
Journal entries and show Share Capital in the Balance Sheet.
13. Authorized capital of Suhani Ltd. is ₹45,00,000 divided into 30,000 shares of ₹150 each. Out of these company issued 15,000 shares of
₹150 each at a premium of ₹10 per share. The amount was payable as follows:
₹50 per share on application, ₹40 per share on allotment (including premium), ₹30 per share on first call and balance on final call. Public
applied for 14,000 shares. All the money was duly received. Prepare an extract of Balance Sheet of Suhani Ltd. as per Schedule Ill, Part I of
the Companies Act, 2013 disclosing the Share Capital.

Oversubscription

14. Faber Ltd invited applications for 70,000 equity shares of ₹100 each. The application money received @₹30 per share was ₹2700000.
Name the kind of subscription. List the three alternatives for allotting these shares.
15. Sangam Ltd. invited applications for 20,000 Equity Shares of ₹ 100 each issued at par. The amount was payable on application. The issue was
oversubscribed by 2,000 shares and allotment was made on pro rata basis. Pass necessary Journal entries.
16. Citizen watches Ltd. invited applications for 50,000 shares of ₹10 each payable ₹3 on application; ₹4 on allotment; and balance on 1st and final call
applications were received for 60,000. Shares applications were accepted for 50,000 shares and remaining applications were rejected. All calls were
made and received except first and final call on 500 shares. Pass the journal entries in the books of citizen watches Ltd.
17. Eastern Company Limited, having an authorised capital of ₹10,00,000 in shares of ₹10 each, issued 50,000 shares at a premium of ₹3 per
share payable as follows:

Applications were received for 60,000 shares and the directors allotted the shares as follows:

(a) Applicants for 40,000 shares received shares, in full.

(b) Applicants for 15,000 shares received an allotment of 8,000 shares.
(c) Applicants for 500 shares received 200 shares on allotment, excess money being returned.
All amounts due on allotment were received. The first call was duly made, and the money was received except for the call due on 100
shares. Give journal and cash book entries to record these transactions of the company. Also prepare the Balance Sheet of the company.
18. Tiny Toys Ltd. issued ₹ 10,00,000 shares of ₹ 100 each at a premium of ₹ 20 for subscription payable as:
₹ 10 per share on application,
₹ 40 per share and ₹ 10 premium on allotment, and
₹ 50 per share and ₹ 10 premium on final payment.
Over-payments on application were to be applied towards amount due on allotment and over-payments on application exceeding amount due on
allotment was to be returned. Issue was oversubscribed to the extent of 13,000 shares. Applicants for 12,000 shares were allotted only 1,000 shares
and applicants for 2,000 shares were sent letters of regret. All the money due on allotment and final call was duly received.
Pass necessary entries in the company's books to record the above transactions. Also, prepare company's Balance Sheet on completion of the above
transactions.
19. Sugandh Ltd. issued 60,000 shares of ₹ 10 each at a premium of ₹ 2 per share payable as ₹ 3 on application, ₹ 5(including premium) on
allotment and the balance on first and final call. Applications were received for 92,000 shares. The Directors resolved to allot as: Mohan,
who had applied for 800 shares in Category
(i) and Sohan, who was allotted 600 shares in Category
(ii) failed to pay the allotment money. Calculate amount received on allotment.
20. Sony Media Ltd. Issued 50,000 shares of ₹ 10 each payable ₹ 3 on application, ₹ 4 on allotment and balance on first and final call. Applications were
received for 1,00,000 shares and allotment was made as follows:
(i) Applicants for 60,000 shares were allotted 30,000 shares,
(ii) Applicants for 40,000 shares were allotted 20,000 shares,
Anupam to whom 1,000 shares were allotted from category
(i) failed to pay the allotment money.
Pass journal entries up to allotment.

Undersubscription

21. Blue Chip Ltd. was registered on 1st January 2022 with a capital of ₹10,00,000 divided into 1,00,000 shares of ₹10 each. The company
issued 42,000 shares of which 40,000 shares were taken up by the public and ₹1 per share was received with application. On 1st February,
these shares were allotted and ₹2 per share was duly received on 28th February as allotment money. A first call of ₹3 per share was made
on 1st March and the call money on all shares except for 100 shares was received. The final call of ₹4 per share was made on 1st June and
 the amount due, except for 400 shares, was received by 30th June. Pass necessary Journal and Cash Book entries and prepare the
Balance Sheet as at 30th June 2022.
22. The authorised capital of Sarang Ltd. Is ₹1,20,00,000 divided into 12,00,000 shares of ₹10 each. Out of these, company issued 8,00,000 shares of ₹10
each at a premium of 20%. The amount per share was payable as follows:
On Application ₹2
On Allotment ₹6 (including premium)
On First Call ₹2
On Final Call Balance
Public applied for 7,80,000 shares. All the money was duly received. Prepare an extract of Balance Sheet of
Sarang Ltd. as per Schedule Ill, Part I of the Companies Act, 2013, disclosing the above information. Also
prepare 'Notes to Accounts’ for the same.

Calls-in-Arrears and Calls-in-Advance

23. 23, Ghosh Ltd. made the second and final call on its 50,000 Equity Shares @₹2 per share on 1st January 2016. The entire amount was received on 15th
January 2016 except on 100 shares allotted to Venkat. Pass necessary Journal entries for the call money due and received by opening Calls-in-Arrears
Account.
24. Amit Ltd. was registered with a capital of ₹500000 in shares of ₹10 each and issued 20,000 such shares at a premium of ₹2 per share, payable as ₹2
per share on application, ₹5 per share on allotment (including premium) and ₹2 per share on first call made three months later. All the money payable
on application and allotment was duly received but when the first call was made, one shareholder paid the entire balance on his holding of 300 shares
and another shareholder holding 1,000 shares failed to pay the first call money.
Pass Journal entries to record the above transactions and show how they will appear in the company's Balance Sheet.
25. Prem Industries Ltd. made the first call on ₹2 per share on its 1,00,000 Equity Shares on 1st March 2021. Ashok, a shareholder, holding 800 shares
paid the second and final call amount along with the first call money. The second and final call amount was ₹3 per share. Pass necessary Journal
entries for recording the above using the Calls-in-Advance Account.
26. Usha Ltd. was found with the capital of ₹100000 divided into shares of ₹100 each. It offered to public for subscription. the amount per share was
payable as 40% on application, 20% on allotment and the balance on 1st and final call. The applicants paid ₹360000 on application and ₹169000 on
allotment. The call has not yet been made. Calculate:
(a)Authorized capital (b)Issued capital (c)Subscribed capital (d)Called up capital (e) Paid up capital (f) call in arrears.

Issue of shares for consideration other than cash

27. 2,000 Equity Shares of ₹ 10 each were issued to Limited from whom assets of ₹ 25,000 were acquired.
Pass Journal entry.
28. Amrit Dhara Ltd. issued 800 Equity Shares of ₹ 100 each at a premium of 25% as fully paid-up in consideration of the purchase of plant and machinery
of ₹ 1,00,000.
Pass entries in company's journal.
29. Z Ltd. purchased furniture costing ₹ 2,20,000 from C.D Ltd. The payment was to be made by issue of 9% Preference Shares of ₹ 100 each at a
premium of ₹ 10 per share. Pass necessary Journal entries in the books of Z Ltd.
30. Goodluck Ltd purchased machinery costing ₹ 10,00,000 from Fair Deals Ltd. The company paid the price by issue of Equity Shares of ₹ 10 each at a
premium of 25%.
Pass necessary Journal entries for the above transactions in the books of Goodluck Ltd.
31. Jain Ltd purchased machinery costing ₹ 10,00,000 from Ayer Ltd. 50% of the payment was made by cheque and for the remaining 50%, the company
issued Equity Shares of ₹ 100 each at a premium of 25%. Pass necessary Journal entries in the books of Jain Ltd. for the above transaction.
32. Rajan Ltd. purchased assets from Geeta & Co. for ₹ 5,00,000. A sum of ₹ 1,00,000 was paid by means of a bank draft and for the balance due Rajan
Ltd. issued equity Shares of ₹ 10 each at a premium of 25%. Journalise the above transactions in the books of the company.
33. Sona Ltd. purchased machinery costing ₹ 17,00,000 from Mona Ltd. Sona Ltd. paid 20% of the amount by cheque and for the balance amount issued
Equity Shares of ₹ 100 each at a premium of 25%. Pass necessary Journal entries for the above transactions in the books of Sona Ltd. Show your
working notes clearly.
34. Bhushan Lamps Ltd. issued 30,000 fully paid-up shares of ₹ 100 each for purchase of the following assets and liabilities from Sharma & Co:
Plant ₹ 7,00,000 Stock-in-Trade ₹ 9,00,000
Land and Building ₹ 12,00,000 Sundry Creditors ₹ 2,00,000
You are required to pass necessary Journal entries.
35. Sandesh Ltd. took over the assets of ₹ 7,00,000 and liabilities of ₹ 2,00,000 from Sanchar Ltd. for a purchase consideration of
₹4,59,500. ₹ 8,500 were paid by accepting a draft in favour of Sanchar Ltd. payable after three months and the balance was paid by
issue of equity shares of ₹10 each at a premium of 10% in favour of Sanchar Ltd.
Pass necessary journal entries for the above transactions in the books of Sandesh Ltd.
36. Sure Ltd. purchased a running business from M/s. Rai Brothers for a sum of ₹ 15,00,000 payable ₹ 12,00,000 in fully paid shares of ₹ 10
each and balance through cheque. The assets and liabilities consisted of the following:
37. Sandesh Ltd. purchased a running business from Sanchar Ltd. for ₹15,00,000 payable 10% by cheque and the balance by the issue of fully
paid Equity Shares of ₹100 each at a premium of 20%. The assets and liabilities consisted of the following:

Particulars Book Value (₹) Agreed Value (₹)

Plant and machinery 500000 650000
Building 300000 250000
Stock 600000 500000
Trade receivables 280000 250000
Trade payables 180000 200000
38. Light Lamps Ltd. issued 50,000 shares of ₹ 10 each as fully paid-up to the promoters for their services to set-up the company. It also issued 2,000
shares of ₹ 10 each credited as fully paid-up to the underwriters of shares for their services. Journalize these transactions.

Forfeiture of shares which were Issued at Par

39. Alpha Ltd. issued 20,000 Equity Shares of ₹ 10 each at par payable: On application ₹ 2 per share; on allotment ₹ 3 per share; on first call ₹ 3 per share;
on second and final call ₹ 2 per share. Mr. Gupta was allotted 100 shares. Pass necessary Journal entry relating to the forfeiture of shares in each of
the following alternative cases:
Case I If Mr. Gupta failed to pay the allotment money and his shares were immediately forfeited.
Case II If Mr. Gupta failed to pay allotment money and on his subsequent failure to pay the first call, his shares were forfeited.
Case III If Mr. Gupta failed to pay the first call and on his subsequent failure to pay the second and final call, his shares were forfeited.
40. Sangita Limited invited applications for issuing 60,000 shares of ₹10 each at par. The amount was payable as follows: On Application ₹ 2
per share On Allotment ₹ 3 per share One First and Final Call ₹ 5 per share Applications were received for 92,000 shares. Allotment was
made on the following basis:
(i) To applicants for 40,000 shares — Full
(ii) To applicants for 50,000 shares — 40%
(iii) To applicants for 2,000 shares — Nil
₹1,08,000 was released on account of allotment (excluding the amount carried from application money) and ₹2,50,000 on account of call.
The directors decided to forfeit shares of those applicants to whom full allotment was made and on which allotment money was overdue.
Pass Journal entries in the books of Sangita Limited to record the above transaction.

Forfeiture of Shares which were Issued at Premium

41. Ankit Ltd. issued 20,000 equity shares of ₹10 each at a premium of ₹2 per share, payable as:
On Application ₹3
On Allotment ₹5 (including premium)
On First Call ₹2
On Second and Final Call ₹2
Vijay was allotted 500 shares. Pass the necessary Journal entries relating to the forfeiture of shares in following cases:
Case 1. Vijay did not pay allotment money and his shares were immediately forfeited.
Case 2. Vijay did not pay allotment and first call; his shares were forfeited after first call.
Case 3. Vijay failed to pay first call and his shares were forfeited immediately.
Case 4. Vijay failed to pay both the calls and his shares were forfeited.
42. Black Stone Ltd. issued 10,000 Equity Shares of ₹10 each at a premium of ₹3 per share payable ₹5 on application, ₹5 (including premium)
on allotment and the balance on first call. All the shares offered were applied for and allotted. All the money due on allotment was received
except on 200 shares. Call was made.
All the amount due thereon was received except on 300 shares. Directors forfeited 200 shares on which both allotment and call money
were not received.
Pass necessary Journal entries to record the above.

Maximum Permissible Discount and Minimum Reissue Price at the time of Reissue

43. Determine the maximum permissible discount and minimum reissue price that a company can allow at the time of reissue of forfeited
shares in the following cases:
(i) A share of ₹10 originally issued at par on which application and allotment money of ₹5 was received
(ii) A share of ₹10 originally issued at a premium of ₹1 on which application and allotment money
(Including premium) of ₹5 was received.
(iii) A share of ₹10 originally issued at a premium of ₹1 on which application and allotment money
 (Excluding premium) of ₹5 was received.

Treatment of Gain on Reissue

44. What amount of gain on reissue will be transferred to Capital Reserve under following situations?
(i) 3,000 shares of ₹10 each of Rakesh were forfeited by crediting ₹5,000 to Forfeited Shares Account. Out of these, 1,800 shares were
reissued to Mohan for ₹9 per share as fully paid-up.
(ii) Z Ltd. forfeited 20 shares of ₹100 each (₹60 called-up) Issued at par to Shiv on which he paid
₹20 per share. Out of these, 15 shares were reissued to Rajesh as ₹60 paid-up for ₹45 per share.

Forfeiture and Reissue of Shares which were Issued at Par

45. Z. Ltd. issued 10,000 shares of the value of ₹10 each, payable ₹3 on application, ₹3 on allotment and ₹4 on the first and final call. All
amounts are duly received except the call money on 100 shares. These shares are subsequently forfeited by Directors and are resold as
fully paid-up for ₹500. Give necessary Journal entries for the transactions.
46. Alfa Ltd. forfeited 900 Equity Shares of ₹ 100 each for the non-payment of allotment money of ₹ 30 per share and the first call of ₹ 20 per
share. The second and final call of ₹ 25 per share has not been made. The forfeited shares were reissued for ₹ 90 per share, ₹ 75 paid-up.
Journalise the above.
47. Max Ltd. forfeited 500 shares of ₹100 each for non-payment of first call of ₹20 per share and final call of ₹25 per share. 250 of these shares
were re-issued at ₹50 per share fully paid-up. Pass the necessary Journal entries in the books of Max Ltd. for forfeiture and re-issue of
shares. Also prepare the Share Forfeiture Account.
48. On 1st May, 2021, Moneyplus ltd. forfeited 200 shares of ₹20 each, ₹15 per share called-up, on which ₹10 per share has been paid by the
amount of the first call of ₹5 per share being unpaid. Ten days Later, the Directors reissued the forfeited shares to B credited as ₹15 per
share paid-up, for a payment of ₹10 per share.
Give Journal entries in the company's books to record the forfeited shares and their reissue.
49. The Directors of Maharana Ltd. resolved on 1st May 2020 that 2,000 Equity Shares of ₹10 each, ₹7.50 paid be forfeited for non-payment of
final call of ₹2.50. On 10th June 2020, 1,800 of these shares were reissued for Rs. 6 per share. Give necessary Journal entries.
50. Sunshine Ltd. issued 20,000 shares of ₹ 100 each payable ₹ 25 per share on application, ₹ 25 per share on allotment and the balance in two calls of ₹
25 each. The company did not make the final call of ₹ 25 per share. All the money was duly received with the exception of the amount due on the first
call on 400 shares held by Mr. Modi. The Board of Directors forfeited these shares and subsequently reissued them @ ₹ 75 per share paid-up for a
sum of ₹ 28,000.
Journalize the above transactions and prepare Share Capital Account.
51. R.P. Ltd. forfeited 1,500 shares of Rahim of ₹10 each issued at a premium of ₹3 per share for non-payment of allotment and first call
money. Rahim had applied for 3,000 shares. On these shares, amount was payable as follows:
On Application ₹3 per share,
On Allotment (including premium) ₹5 per share,
On First Call ₹3 per share,
On Final Call Balance.
Final call has not been called up. 1,000 of the forfeited shares were reissued for ₹8,500 as fully paid-up.
Record the necessary Journal entries for the above transactions in the books of R.P. Ltd.
52. The Hindustan Manufacturing Ltd. had a total subscribed capital of ₹ 10,00,000 in Equity Shares of ₹ 10 each of which ₹ 7.50 were called-up. A final
call of ₹ 2.50 was made and all amounts paid except two calls of ₹ 2.50 each in respect of 100 shares held by D. These shares were forfeited and
reissued at ₹ 8 per share.
Pass necessary journal entries (including that of cash) to record the transactions of final call, forfeiture of shares and reissue of forfeited shares. Also,
prepare the Balance Sheet of the company.
53. Star Ltd. forfeited 500 Equity Shares of ₹ 100 each for non-payment of first call of ₹ 30 per share. The final call of ₹ 10 per share was not
yet made. Out of these, 60% shares were reissued for ₹ 39,000 fully paid. Journalize the forfeiture and reissue of shares.
54. Super Star Ltd. makes an issue of 10,000 Equity Shares of ₹100 each, payable as:
On Application and Allotment ₹50 per share,
On First Call ₹25 per share,
On Second and Final Call ₹25 per share.
Members holding 400 shares did not pay the second and final call and the shares are duly forfeited, 200 of which are reissued as fully
paid-up @₹ 50 per share. Pass journal entries in the books of the company.
55. Give necessary Journal entries:
(i)The Directors of Devendra Ltd. resolved on 1st January 2010 that Equity Shares of ₹ 10 each, ₹ 8 paid-up be forfeited for non-payment of final
call of ₹ 2. On 1st February, 60 of these shares were reissued @ ₹ 7 per share as fully paid-up.
(ii) Virender Limited forfeited 20 shares of ₹100 each (₹60 called up) issued at par to Mukesh on which he had paid ₹20 per share. Out of these,
15 shares were reissued to Sanjeev as ₹60 paid-up for ₹45 per share.
56. Show the forfeiture and reissue entries under each of the following cases:
(i)KBC Ltd. forfeited 300 shares of ₹10 each, ₹8 called up held by Amit for non-payment of second call money of ₹3 per share. These
shares were reissued to Zoly for ₹10 per share as fully paid-up.
(ii) KK Ltd. forfeited 400 shares of ₹10 each, fully called-up, held by Bhawna for non-payment of final call money of ₹4 per share.
(iii) Light Ltd. forfeited 250 shares of ₹10 each, fully called-up, held by Chetan for non-payment of allotment
money of ₹3 per share and first and final call money of ₹4 per share. These shares were reissued @₹8 per share as fully paid-up to Prem.
57. Rekha holds 100 shares of ₹10 each on which he has paid ₹1 per share on application.
Sunita holds 200 shares of ₹10 each on which he has paid ₹1 and ₹2 per share on application and allotment respectively.
 Teena holds 300 shares of ₹10 each and has paid ₹1 on application, ₹2 on allotment and ₹3 on first call.
They all fail to pay their arrears and the second call of ₹2 per share. Shares are forfeited and subsequently reissued @₹11 per share as
fully paid-up.
Journalize the above.
58. Record the journal entries for forfeiture and reissue of shares in the following cases:
(i) Basak Ltd. forfeited 20 shares of ₹10 each, ₹ 7 called-up on which the shareholder had paid application and allotment money of ₹ 5 per share. Out
of these, 15 shares were reissued to Naresh as ₹ 7 per share paid-up for ₹ 8 per share.
(ii) Y Ltd. forfeited 90 shares of ₹10 each, ₹ 8 called up issued at a premium of ₹ 2 per share to 'R' for non-payment of allotment money of ₹ 5 per share
(including premium). Out of these, 80 shares were reissued to Sanjay as ₹ 8 called-up for ₹ 10 per share.
59. Jain Ltd. invited applications for issuing 1, 12,000 equity shares of ₹ 10 each at par. The amount per share was payable as follows:
On Application - ₹1
On Allotment - ₹2
On First call - ₹3
On Second and Final call - ₹4
Applications for 1,00,000 shares were received. Shares were fully allotted to all the applicants. Ramesh failed to pay his allotment money
which was ₹2,000. His shares were forfeited immediately. Suresh did not pay the first call on 500 shares applied by him. His shares were
forfeited after the first call. The forfeited shares of Ramesh and Suresh were re-issued at₹9 per share fully paid up. Afterwards the second
and final call was made and was duly received. Pass necessary journal entries for the above transactions in the books of Jain Ltd.
60. Software Ltd. company with registered capital of ₹ 5,00,000 in shares of ₹ 10 each issued 20,000 of such shares payable ₹ 2 on
application, ₹ 4 on allotment, ₹ 2 on first call ₹ 2 on final call. All the money payable on allotment was duly received but on the first call
being made, one shareholder paid the entire balance on his holding of 300 shares and five shareholders with a total holding of 1,000
shares failed to pay their dues on the first call. These shares were forfeited for non-payment of first call money. Final call was made and all
the money due was received. Later on, forfeited shares were reissued @ ₹ 6 per share as fully paid-up. Record the above in the company's
Journal and prepare the Balance Sheet.
61. Slow & Steady Ltd. invited applications for 10,000 Equity Shares of ₹ 10 each for public subscription. The amount of these shares was
payable as: on application ₹1 per share, on allotment ₹ 2 per· share, on first call ₹3 per share and on second and final call ₹4 per share.
All sums payable on application, allotment and calls were duly received with the following exceptions:
(i) A, who held 200 shares, failed to pay the money on allotment and calls.
(ii) 8, to whom 150 shares were allotted, failed to pay the money on first call and final call.
(iii) C, who held 50 shares, did not pax the amount of second and final call.
The shares of A, B and C were forfeited and were subsequently reissued for cash as fully paid-up at a discount of 5%.
Pass necessary Journal entries to record these transactions in the books of the company.
62. 'Venus Ltd. was registered with an authorized capital of ₹40,00,000 divided into 4,00,000 equity shares of ₹10 each. 70,000 of these shares
were issued as fully paid to 'M/s. Star Ltd.’ for building purchased from them. 2,00,000 shares were issued to the public and the amounts
were payable as follows:
On Application ₹3 per share
On Allotment ₹ 2 per share
On First Call ₹2 per share
On Second and Final Call ₹ 3 per share
The amounts received on these shares were as follows:
On 1,00,000 shares Full amount called
On 60,000 shares ₹ 7 per share
On 30,000 shares ₹ 5 per share
On 10,000 shares ₹ 3 per share
The directors forfeited 10,000 shares on which only ₹ 3 per share were received. These shares were reissued at ₹ 12 per share fully paid.
Pass necessary Journal entries for the above transactions in the books of Venus Ltd.
63. Kwality Hospitality Ltd. incorporated with authorized capital of ₹1000000 equity shares of ₹10 each issued 50,000 equity shares for
subscription payable ₹4 on application, ₹3 on allotment and balance as first and final call. Shares were subscribed, and due amounts were
received except first and final call on 4000 shares. These shares were forfeited. Later, half the shares were reissued as fully paid-up and
₹4000 were transferred to Capital Reserve.
Pass the Journal entry for reissue of shares
64. A share of Rs. 100 issued at a premium of ₹. 10 on which ₹80 (including premium) was called and ₹. 60 (including premium) was paid, has
been forfeited. This share was afterwards reissued as fully paid-up for ₹. 70. Give Journal entries to record the above.
65. Pass Journal entries in the following cases:
NK Ltd forfeited 200 shares of ₹ 10 each, issued at a premium of ₹ 5 per share, held by Ram for non-payment of the final call of ₹ 3 per share. 100 out
of these shares were reissued to Vishnu at a discount of ₹ 4 per share.
66. VT Ltd forfeited 200 shares of ₹ 10 each, issued at a premium of ₹ 5 per share, held by Mohan for non-payment of the final call of ₹ 3 per share. 100 out
of these shares were reissued to Narendra at a discount of ₹ 4 per share. Journalize.
67. The Directors of a company forfeited 300 shares of ₹ 10 each issued at a premium of ₹ 3 per share, for the non-payment of the first call money of ₹ 2
per share. The final call of ₹ 2 per share has not been made. Half the forfeited shares were reissued at ₹ 1,500 as fully paid-up. Record the journal
entries for the forfeiture and reissue of shares.
68. X Ltd. forfeited 100 shares of ₹ 10 each (₹ 8 called-up) issued at a premium of ₹ 2 per share to Mr. R on which he had paid applications
money of ₹ 5 per share, for non-payment of allotment money of ₹ 5 per share (including premium). Out of these, 70 shares were reissued
to Mr. Sanjay as ₹ 8 called-up for ₹ 7 per share. Give necessary journal entries relating to forfeiture and reissue of shares
69. 150 shares of ₹ 10 each issued at a premium of ₹ 4 per share payable with allotment were forfeited for non-payment of allotment money of
₹ 8 per share including premium. The first and final call of ₹ 4 per Pass Journal entries in the books of X Ltd. for the above.
70. JCV Ltd., forfeited 200 shares of ₹ 10 each issued at a premium of ₹ 2 per share for the non-payment of allotment money of ₹ 3 per share (including
premium). The first and final call of ₹ 4 per share has not been made as yet. 50% of the forfeited shares were reissued at ₹ 8 per share as fully paid-up.
Pass necessary Journal entries for the forfeiture and reissue of shares.
71. Pass necessary journal entries in the books of the company for the following transactions: Vishesh Ltd. forfeited 1,000 Equity Shares of ₹ 10 each
issued at a premium of ₹ 2 per share for non-payment of allotment money of ₹ 5 per share including premium. The final call of ₹ 2 per share was not
 yet called on these shares. Of the forfeited shares 800 shares were reissued at ₹ 12 per share as fully paid-up. The remaining shares were reissued at
₹ 11 per share fully paid-up. Pass Journal entries in the books of X Ltd. for the above.
72. Gaurav applied for 5,000 shares of ₹ 10 each at a premium of 2.50 per share. But he was allotted only 2,500 shares on pro rata basis. After
having paid ₹ 3 per share on application, he did not pay allotment money of ₹ 4.50 per share (including premium) and on his subsequent
failure to pay the first call of ₹ 2 per share, his shares were forfeited. These shares were reissued at the rate of ₹ 8 per share credited as
fully paid.
73. Telecom Ltd. issued 20,000 Equity Shares of ₹ 10 each at a premium of ₹ 5 per share, payable as ₹ 7 (including premium) on application, ₹ 5 on
allotment and the balance after three months of allotment.
A shareholder to whom 200 shares were allotted failed to pay the allotment and call money and his shares were forfeited. 160 of the forfeited shares
were reissued for ₹1,600.
Give necessary entries in company's journal and the Balance Sheet.
74. Healthy foods ltd. had authorized capital of ₹50,00,000, 5,00,000 equity shares of ₹10 each issued 3,75,000 equity shares for subscnpt1on at a
premium of 20% payable ₹4 on application, ₹5 on allotment and balance as first and final call. The shares were subscribed, and due amounts were
received except allotment money on 25,000 shares. These shares were forfeited. Later these shares were reissued at ₹7 paid up and ₹50,000 word
transferred to capital reserve. First and final call boss demanded from the shareholders and was received except on 10,000 which was transferred to
Call-in-Arrears account.
Pass the journal entries for forfeiture, reissue of forfeited shares and 1st and final call.
75. Panasonic Ltd. was formed on 1st April 2010 with an authorized capital of ₹2,00,000, divided into 2,000 Equity Shares of ₹100 each. 1,000
shares were issued as fully paid to the vendors of building for
payment of the purchase consideration. The remaining 1,000 shares were offered for public subscription
at a premium of ₹5 per share payable as:
On application ₹10 per share
On allotment ₹25 per share (including premium),
On first call ₹40 per share
On final call ₹30 per share
Applications were received for 900 shares which were duly allotted, and the allotment money was received
in full. At the time of the first call, a shareholder who held 100 shares failed to pay the first call money and
his shares were forfeited. These shares were reissued @₹60 per share ₹70 per share paid-up Final call has
not been made.
You are required to (i) give necessary Journal entries to record the above transactions and (ii) show how
share capital would appear in the Balance Sheet of the company.
76. VXN Ltd. invited applications for issuing 50,000 equity shares of ₹10 each at a premium of ₹8 per share. The amount was payable as
follows:

On Application ₹4 per share (including₹2 premium)

On Allotment ₹6 per share (including₹3 premium)
On First Call ₹5 per share (including₹1 premium)
On Second and Final Call Balance Amount

The issue was fully subscribed. Gopal, a shareholder holding 200 shares, did not pay the allotment money
and Madhav, a holder of 400 shares, paid his entire share money along with the allotment money. Gopal's shares were immediately
forfeited after allotment. Afterwards, the first call was made. Krishna, a holder of 100 shares, failed to pay the first call money and Girdhar,
a holder of 300 shares, paid the second call money also, along with the first call. Krishna's shares were forfeited, immediately after the first
call. Second and final
call was made afterwards and was duly received. All the forfeited shares were reissued at ₹9 per share
fully paid-up.
Pass necessary Journal entries for the above transactions in the books of the company.

77. Sukanya ltd. Invited applications for issuing 100000 equity shares of ₹10. The shares were issued at premium of ₹20 per share. The amount was

payable as follows:

On application ₹14 per share

On first call ₹8 per share

On final call ₹8 per share

Applications for 96000 shares were received. Rohit a shareholder holding 7000 shares failed to pay both the calls and Nimit a holder of 5000 shares did

not pay the final call. Shares of Rohit and Namit were forfeited. Of the forfeited shares, 8,000 shares including all the 5 Rohit were reissued

to Reena at ₹8 per share fully paid-up. Pass necessary Journal entries for the above transactions in the books of Sukanya Ltd.

Forfeiture and Reissue of Shares which were Allotted on Pro rata

78. Alfa Ltd. invited applications for issuing 75,000 equity shares of ₹10 each. The amount was payable as follows:
On Application and Allotment. ₹4 per share
On First Call ₹3 per share
On Second and Final Call balance
Applications for 1,00,000 shares were received. Shares were allotted to all the applicants on pro rata basis and excess money received
with applications was transferred towards sums due on first call. Vibha who was allotted 750 shares failed to pay the first call. Her shares
were immediately forfeited. Afterwards the second call was made. The amount due on second call was also received except on 1,000
shares applied by Monika. Her shares were also forfeited. All the forfeited shares were reissued to Mohit for ₹9,000 was fully paid-up.
Pass necessary Journal entries in the Books of Alfa Ltd. for the above transactions.
79. Himalaya Company Limited issued for public subscription 1,20,000 equity shares of ₹10 each at a premium for ₹2 per share payable as
under:
On Application ₹3 per share,
On Allotment (including premium) ₹5 per share,
On First call ₹2 per share,
On Second and Final call ₹2 per share.
Applications were received for 1,60,000 shares. Allotment was made on pro rata basis. Excess money on application were adjusted against
the amount due on allotment.
Rohan to whom 4,800 shares were allotted, failed to pay for the two calls. These shares were subsequently forfeited after the second call
was made. All the shares forfeited were reissued to Teena as fully paid at ₹7 per share.
Record Journal entries and show transactions relating to share capital in the company’s Balance Sheet.
80. Saregama Ltd. invited applications for issuing 80,000 equity shares ₹100 each at a premium of ₹10. The amount was payable as follows:
On Application ₹ 30
On Allotment ₹ 30 (including a premium of ₹ 10)
On First Call ₹30
On Final Call Balance
Applications of 120000 shares were received. Allotment was made on pro rata basis to all applicants. excess money received on
application was adjust on sums due on allotment. Dhwani who was allotted 1600 shares, failed to pay allotment money and Sargam who
applied for 6000 shares did not pay first call money.
These shares were forfeited immediately after first call. 2000 of these shares including all shares of Dhwani) were issued to Tarang for ₹95
per share as ₹80 paid up. Pass necessary journal entries and books of Saregama Ltd. by opening Calls-In-Arrear and Calls-In-Advance
accounts if a final call has not been made.
81. Jeevan Dhara Ltd. invited applications for issuing 1,20,000 equity shares of Rs 10 each at a premium of Rs 2 per share. The amount was
payable as follows:

On application — ₹ 2 per share,

On allotment — ₹ 5 per share(including premium),
On first and final call — Balance.
Applications for 1,50,000 shares were received . Shares were allotted to all the applicants on pro rata basis. Excess money received on applications
was adjusted towards sums due on allotment . All calls were made. Manu who had applied for 3,000 shares failed to pay the amount due on allotment
and first and final call Madhur who was allotted 2,400 shares failed to pay the first and final call . Shares of both Manu and Madhur were forfeited . The
forfeited shares were reissued at ₹ 9 per share as fully paid-up .
Pass necessary journal entries for the above transactions in the books of Jeevan Dhara Ltd.
82. (Forfeiture of Shares which were Issued at Premium-Premium not received).
Sargam Ltd. invited applications for issuing 80,000 equity shares of ₹100 each at a premium The amount was payable as follows:
On Application- ₹20 per share;
On Allotment- ₹60 (including premium) per share;
On First and Final Call - ₹40 per share.
Applications for 1,20,000 shares were received. Allotment was made on pro rata basis to all the applicants. Excess money received on
applications was adjusted on sums due on allotment. Sitaram, who had applied for 6,000 shares, failed to pay the allotment money and
Harnam did not pay first and final call on 800 shares allotted to him. The shares of Sitaram and Harnam were forfeited. 4,200 of these
shares were reissued for ₹100 per share as fully paid-up. The reissued shares included all the forfeited shares of Harnam. Pass necessary
Journal entries for the above transactions in the books of Sargam Ltd.
83. JJK Ltd. Invited Applications for Issuing 50,000 Equity Shares of ₹10 Each at Par. The amount was payable as follows:
On Application ₹ 2 per share,
On Allotment ₹ 4 per share; and
On First and Final call Balance Amount.
The issue was oversubscribed three times. Applications for 30% shares were rejected and money refunded. Allotment was made to the
remaining applicants as follows:
Excess money paid by the applicants who were allotted shares was adjusted towards sums due on allotment.
Deepak, a shareholder belonging to Category I, who had applied for 1,000 shares, failed to pay the allotment money. Raju, a shareholder
holding 100 shares, also failed to pay the allotment money. Raju belonged to Category II. Shares of both Deepak and Raju were forfeited
immediately after allotment. Afterwards, first and final call was made and was duly received. The forfeited shares of Deepak and Raju were
reissued at ₹ 11 per share fully paid-up.
Pass necessary journal entries for the above transactions in the books of company.
84. XYZ Ltd. is registered with an authorised capital of ₹ 2,00,000 divided into 2,000 shares of ₹ 100 each of which, 1,000 shares were offered for public
subscription at a premium of ₹ 5 per share, payable as:
On application — ₹ 10 per share,
On allotment — ₹ 25 per share (including premium),
On first call — ₹ 40 per share
On final call — ₹ 30 per share
Applications were received for 1,800 shares, of which applications for 300 shares were rejected outright; the rest of the application were allotted 1,000 shares
on pro rata basis. Excess application money was transferred to allotment.
All the money was duly received except from Sundar, holder of 100 shares, who failed to pay allotment and first call money. His shares were later forfeited
and reissued to Shyam at ₹ 60 per share ₹ 70 paid-up. Final call has not been made.
Pass necessary Journal entries and prepare Cash Book in the books of XYZ Limited.

85. A Ltd. invited applications for issuing 1,00,000 shares of ₹10 each at a premium of ₹1 per share. The amount was payable as follows:
On Application: ₹3 per share
On Allotment − ₹3 per share (including premium),
On First Call − ₹3 per share,
On Second and Final Call − Balance amount.
Applications for 1,60,000 shares were received. The allotment was made on the following basis:
(i) To applicants for 90,000 shares: 40,000 shares
(ii) To applicants for 50,000 shares: 40,000 shares
(iii) To applicants for 20,000 shares–Full shares.

Excess money paid on application is to be adjusted against the amount due on allotment and calls. Rishabh, a shareholder, who applied for 1,500 shares and belonged to
category II, did not pay allotment, first and second and final call money. Another shareholder, Sudha, who applied for 1,800 shares and belonged to category I, did not pay
the first and second and final call money. All the shares of Rishabh and Sudha were forfeited and were subsequently reissued at ₹ 7 per share fully paid.
Pass the necessary Journal entries in the books of A Ltd. Open Calls-in-Arrears Account and Calls-in-Advance Account wherever required.

86. Ruchi Ltd. issued for public subscription 40,000 Equity Shares of ₹10 each at a premium of ₹2 per share payable as :
On application − ₹2 per share,
On allotment − ₹5 per share (including premium),
On first call − ₹2 per share,
On second and final call − ₹3 per share.
Applications were received for 60,000 shares and the allotment was made on pro-rata basis to the applicants for 48,000 shares, the remaining
applications being refused. Money overpaid on application was utilized towards sums due on allotment. Ram to whom 1,600 shares were allotted
failed to pay the allotment money and Shyam to whom 2,000 shares were allotted failed to pay the two calls. These shares were subsequently forfeited
after the second and final call was made. All the forfeited shares were reissued as fully paid-up @ ₹ 8 per share.
Give necessary Journal entries for the above transactions.
87. Competent Ltd. issued a prospectus inviting applications for 50,000 Equity Shares of ₹ 10 each, payable ₹ 5 as per application (including ₹ 2 as
premium), ₹ 4 as per allotment and the balance towards first and final call.
Applications were received for 65,000 shares. Application money received on 5,000 shares was refunded with letter of regret and allotments were
made on pro rata basis to the applicants of 60,000 shares. Money overpaid on applications including premium was adjusted on account of sums due
on allotment.
Mr. Sharma to whom 700 shares were allotted failed to pay the allotment money and his shares were forfeited by the Directors on his subsequently
failure to pay the call money.
All the forfeited shares were subsequently sold to Mr. Jain credited as fully paid-up for ₹9 per share.
You are required to set out the Journal entries and the relevant entries in the Cash Book.
88. Janta ltd issued applications for 5,00,000 equity shares of ₹10 each at a premium of ₹4 per share. The amount was payable as follows: On
application ₹6 (including ₹2 premium), on Allotment ₹6 (including ₹2 premium) and Balance Sheet on first and final call. Applications for
7,50,000 shares were received. Allotment was made to all the applicants on pro-rata basis. Mohan to whom 1,000 shares were allotted did
not pay allotment and call money. Vikram to whom the shares were allotted, did not pay the call money. These shares were forfeited and
afterwards reissued @ ₹8 per share fully paid-up. Pass the necessary Journal entries.

When all the Forfeited shares are not issued

89. Nitro Paints Ltd. invited applications for issuing 1,60,000 equity shares of ₹10 each at a premium of ₹3 per share. The amount was payable as follows:
On application — ₹6 per share (including premium ₹1);
On allotment — ₹3 per share (including premium ₹1); and
The balance — on First and Final call.
Applications for 1,80,000 shares were received. Applications for 10,000 shares were rejected and pro rata allotment was made to the remaining applicants.
Over payment received on application was adjusted towards sums due on allotment. All calls were made and were duly received except allotment and final
call from Aditya who was allotted 3,200 shares. His shares were forfeited. Half of the forfeited shares were reissued for ₹43,000 as fully paid-up.
Pass necessary journal entries for the above transactions in the books of Nitro Paints Ltd.
90. Raja Ltd. invited applications for issuing 50,000 Equity Shares of ₹10 each. The amount was payable as follows:
On application — ₹3 per share,
On allotment — ₹5 per share,
On first and final call — Balance.
Applications for 70,000 shares were received. Allotment was made to all applicants on pro rata basis. Excess money received on application was adjusted
towards sums due on allotment. Ramesh, who had applied for 700 shares, did not pay the allotment money and on his failure to pay the allotment money his
shares were forfeited. Afterwards, the first and the final call was made. Adhar, who had been allotted 500 shares, did not pay the first and final call. His shares
were also forfeited. Out of the forfeited shares 900 shares were reissued at ₹8 per share as fully paid-up. The reissued shares included all the shares of
Ramesh.
Pass necessary journal entries for the above transactions in the books of the company.
91. XYZ Ltd. invited applications for issuing 50,000 Equity Shares of ₹10 each . The amount was payable as:
On application — ₹3 per share,
On allotment — ₹4 per share,
On first and final call — ₹3 per share.
Applications were received for 75,000 shares and pro rata allotment was made as:
Applicants for 40,000 shares were allotted 30,000 shares on pro rata basis.
Applicants for 35,000 shares were allotted 20,000 shares on pro rata basis.
Ramu, to whom 1,200 shares were allotted out of the group applying for 40,000 shares, failed to pay the allotment money. His shares were forfeited
immediately after allotment. Shamu, who had applied for 700 shares out of the group applying for 35,000 shares , failed to pay the first and final call . His
shares were also forfeited. Out of the forfeited shares, 1,000 shares were reissued @₹8 per share as fully paid-up. The reissued shares included all the
forfeited shares of Shamu.
Pass necessary Journal entries to record the above transactions.
92. Konark Ltd. invited applications for issuing 3,00,000 shares of ₹10 each. The amount per share was payable as follows:
₹3 on application, ₹3 on allotment, and₹ 4 on first and final call.The company received applications for 4,00,000 shares. Allotment was
done as follows:
(i) Applicants of 2,40,000 shares were allotted 2,00,000 shares.
(ii) Applicants of 1,20,000 shares were allotted 80,000 shares.
(iii) Remaining applicants were allotted 20,000 shares.
Money overpaid on applications was adjusted towards sums due on allotment. Divij, a shareholder, belonging to group (ii), who had
applied for 6,000 shares, failed to pay allotment and call money. Faisal, another shareholder, who was allotted 10,000 shares, paid the call
money along with allotment. Faisal belonged to group (i). Divij’s shares were forfeited after the first and final call. Half of the forfeited
shares were reissued @₹10 per share fully paid. Pass the necessary journal entries to record the above transactions in the books of the
company.
93. Max Ltd. invited applications for 2,00,000 Equity Shares of ₹10 each to be issued at 20% premium. The money payable per shares was: on application
₹5, on allotment ₹4 (including premium of ₹ 2), first call ₹2 and final call ₹1.
Applications were received for 2,40,000 shares and allotment was made as:
(i) to applicants for 1,00,000 shares— in full,
(ii) to applicants for 80,000 shares—60,000 shares,
(iii) to applicants for 60,000 shares—40,000 shares.
Applicants of 1,000 shares falling in Category (i) and applicants of 1,200 shares falling in Category (ii) failed to pay allotment money. These shares
were forfeited on failure to pay first call. Holders of 1,200 shares falling in Category (iii) failed to pay the first and final call and these shares were
forfeited after final call. 1,300 shares [1,000 of Category(i) and 300 of Category (ii)] were reissued at ₹8 per share as fully paid-up.
Journalize the above transactions. Prepare Cash book and Balance Sheet.
94. XYZ Ltd . issued a prospectus inviting applications for 2,000 shares of ₹ 10 each at a premium of ₹ 4 per share , payable as:
On application — ₹ 6 (including ₹ 1 premium)
On allotment — ₹ 2 (including ₹ 1 premium)
On first call — ₹ 3 (including ₹ 1 premium)
On second and final call — ₹ 3 (including ₹ 1 premium)
Applications were received for 3,000 shares and pro rata allotment was made on the applications for 2,400 shares. It was decided to utilise excess
application money towards the amount due on allotment .
X, to whom 40 shares were allotted, failed to pay the allotment money and on his subsequent failure to pay the first call , his shares were forfeited.
Y, who applied for 72 shares failed to pay the two calls and on his such failure , his shares were forfeited.
Of the shares forfeited , 80 shares were sold to Z credited as fully paid-up for ₹ 9 per share , the whole of Y's shares being included . Prepare Journal , Cash
Book and the Balance Sheet .