12th Class
Accountancy
Sample Paper
Accountancy - Sample Paper-5
question_answer
On 1st April, 2016, Ranjana Ltd. made an issue of 3,00,000 equity shares of Rs. 10 each at a premium of Rs. 4 per share, payable as follows: Rs. 6 on application (including Rs. 1 premium) Rs. 2 on allotment (including Rs. 1 premium) Rs. 3 on first call (including Rs. 1 premium) Rs. 3 on second and final call (including Rs. 1 premium) Applications were received for 4,50,000 shares, of which applications for 90,000 shares were rejected and their money was refunded. Rest of the applicants were issued shares on prorata basis and their excess money was adjusted towards allotment. Jatin, to whom 6,000 shares were allotted, failed to pay the allotment money and his shares were forfeited after allotment. Ruchi, who applied for 10,800 shares failed to pay the two calls and on her such failure, her shares were forfeited. 12,000 forfeited shares were re-issued as fully paid on receipt of Rs. 9 per share, the whole of Ruchi's shares being included. Prepare the cash book and pass the necessary journal entries. Or Hindustan Ltd invited application for 14,000 equity shares of Rs. 10 each payable as under: On application - Rs. 2 On first call - Rs. 3 On allotment - Rs. 2 On final call - Rs. 3 Application were received for 21,000 shares and pro-rata allotment was made to all the applicants. All the shareholders paid the amount due with the following exception: (i) Rajeev, who was allotted 1,400 shares, failed to pay the allotment and calls. (ii) Sanjeev, who was allotted 1,050 shares paid only application and allotment. These shares were forfeited and subsequently 1,800 shares were reissued as fully paid at a discount of 20%. Shares reissued include 1,000 shares of Rajeev and 800 shares of Sanjeev. Pass necessary journal entries.
To Equity Share First Call A/c \[\left( 9,000\times 3 \right)\]
27,000
To Equity Share Second and Final Call A/c \[\left( 9,000\times 3 \right)\]
27,000
To Forfeited Shares A/c
54,000
(Being 9,000 shares of Ruchi forfeited for non-payment of calls)
Forfeited Equity Shares A/c \[(12,000\times 1)\]
Dr
12,000
To Equity Share Capital A/c
12,000
(Being the Discount on reissue adjusted against the credit balance of forfeited shares account)
Forfeited Equity Shares A/c
Dr
60,000
To Capital Reserve A/c (WN 3)
60,000
(Being the profit on reissue transferred to capital reserve)
Working Notes 1. (i) Excess Amount Received from Jatin on Application 6,000 shares were allotted to Jatin. Therefore, he must have applied for\[\left( \frac{3,60,000}{3,00,000}\times 6,000 \right)=7,200\] Shares Excess application money received from Jatin \[(7,200-6,000)=1,200\,Shares\times Rs.\,6=Rs.\,7,200\] (ii)
Money due from Jatin on Allotment
Amt (Rs.)
\[6,000\text{ }shares\times Rs.2\]
12,000
(-) Excess application money adjusted on allotment
(7,200)
[Rs. 6,000 as a part of share capital \[\left( 6,000\times \,Rs.\,1 \right)\]and balance Rs. 1,200 as a part of securities premium]
Money due from Jatin
4,800
(iii)
Money Received on Allotment
Amt (Rs.)
Total amount due on allotment \[\left( 3,00,000\times Rs.\,2 \right)\]
2. Ruchi applied for 10,800 shares. Therefore, he must have been allotted \[=\frac{3,00,000}{3,60,000}\times 10,800=9,000\] Shares He has not paid first and second call money. As such, (i) First call money will be received on 2,94,000 - 9,000 shares of Ruchi = 2,85,000 Shares (ii) Second call money will be received on 2,94,000 - 9,000 shares of Ruchi = 2,85,000 shares 3. Amount Transferred to Capital Reserve
12,000 shares have been reissued which include 9,000
Amt (Rs.)
shares of Ruchi and the balance 3,000 of Jatin
(i) Amount forfeited in respect of Ruchi shares
54,000
(ii) Amount forfeited in respect of Jatin shares \[=\left( 36,000\times \frac{3,000}{6,000} \right)\]
18,000
72,000
(-) Loss on re-issue of 12,000 shares @ Rs. 1 each
(12,000)
Profit on re-issue to be transferred to capital reserve
60,000
4. Balance in forfeited shares account Profit on 6,000 shares of Jatin Rs. 36,000 Therefore, the balance of forfeited shares account on 3,000 unissued shares \[\left( \frac{36,000}{6,0000}\times 3,000 \right)\] is Rs. 18,000 It should be noted that forfeited amount of shares not yet reissued will be shown in the balance sheet as part of capital. 5. Securities premium reserve related to allotment of 6,000 shares to Jatin \[=6,000\times Rs.\,1=Rs.\,6,000,\] out of this Rs. 1,200 is already received as surplus application money. Balance of Rs. 4,800 has not been received by the company. Therefore, at the time of forfeiture, securities premium reserve account will be debited by Rs. 4,800 to cancel it because securities premium account was credited at the time of allotment. This should also be considered at the time of forfeiture of Ruchi shares. Or JOURNAL
Date
Particulars
LF
Amt (Dr)
Amt (Cr)
Bank A/c
Dr
4,20,000
To Equity Share Application A/c
2,20,000
(Being application money received)
Equity Share Application A/c
Dr
4,20,000
To Equity Share Capital A/c
2,80,000
To Equity Share Allotment A/c
1,40,000
(Being application money transferred to capital account and excess money adjusted at allotment)
