Question

Manika Ltd. forfeited 500 shares of \rupee100 each for non-payment of the first call of \rupee20 per share and the second and final call of \rupee25 per share. 250 of these shares were reissued at \rupee50 per share fully paid up. Pass the Journal Entries for forfeiture and reissue of shares.

Hint:

For share forfeiture and reissue, carefully calculate the unpaid amount, reissue price, and transfer any surplus in the forfeiture account to Capital Reserve.

Answer 1

% Journal Entries \begin{center} \begin{tabular}{|p{3cm}|p{8cm}|p{2.5cm}|p{2.5cm}|} Date & Particulars & Debit (\rupee) & Credit (\rupee)
1-Apr-2023 & Share Capital A/c & 50,000 &
& {0.5cm} To Share Forfeiture A/c & & 27,500
& {0.5cm} To Calls in Arrears A/c & & 22,500
& (500 shares forfeited for non-payment of calls) & &
1-Apr-2023 & Bank A/c & 12,500 &
& Share Forfeiture A/c & 12,500 &
& {0.5cm} To Share Capital A/c & & 25,000
& (250 shares reissued at \rupee50 per share fully paid up) & &
1-Apr-2023 & Share Forfeiture A/c & 15,000 &
& {0.5cm} To Capital Reserve A/c & & 15,000
& (Balance in share forfeiture account transferred to capital reserve) & &
\end{tabular} \end{center}