Question

Match List-I with List-II

List-I (Name of account to be debited or credited, when shares are forfeited)	List-II (Amount to be debited or credited)
(A) Share Capital Account	(I) Debited with amount not received
(B) Share Forfeited Account	(II) Credited with amount not received
(C) Calls-in-arrears Account	(III) Credited with amount received towards share capital
(D) Securities Premium Account	(IV) Debited with amount called up

Choose the correct answer from the options given below:

• (A) - (I), (B) - (II), (C) - (III), (D) - (IV)
• (A) - (I), (B) - (II), (C) - (IV), (D) - (III)
• (A) - (IV), (B) - (III), (C) - (II), (D) - (I)
• (A) - (III), (B) - (IV), (C) - (I), (D) - (II)

Answer 1

The Correct Option is C

In accountancy, when shares are forfeited due to non-payment, specific accounts need to be adjusted. Let's match each account from List-I with its proper description in List-II:

List-I	List-II
Share Capital Account	Debited with amount called up
Share Forfeited Account	Credited with amount received towards share capital
Calls-in-arrears Account	Credited with amount not received
Securities Premium Account	Debited with amount not received

Explanation:

• Share Capital Account: When shares are forfeited, the Share Capital Account is affected by the entire called-up amount, regardless of the amount paid.
• Share Forfeited Account: Credited with any amount already received for the forfeited shares.
• Calls-in-arrears Account: Represents the outstanding amount not received on calls, credited for the unpaid portion.
• Securities Premium Account: Debited only if the premium amount hasn't been received fully, which does not affect any match in this scenario.

Correct Matching:  (A) - (IV), (B) - (III), (C) - (II), (D) - (I)

Answer 2

(A) Share Capital Account:
When shares are forfeited, the Share Capital Account is debited with the amount called up on those shares. Hence, the correct match for Share Capital Account is (IV) - Debited with amount called up.

(B) Share Forfeited Account:
The Share Forfeited Account represents the amount forfeited on shares that were not paid for. Therefore, this account is credited with the amount not received on the shares. Thus, the correct match is (III) - Credited with amount received towards share capital.

(C) Calls-in-arrears Account:
This account represents the amounts due but not received from shareholders. Therefore, the Calls-in-arrears account is debited with the amount not received. Thus, the correct match is (II) - Credited with amount not received.

(D) Securities Premium Account:
The Securities Premium Account is credited with the amount received from shareholders over and above the face value of shares. When shares are forfeited, this account is debited with the amount called up but not paid. Hence, the correct match for Securities Premium Account is (I) - Debited with amount not received.

Therefore, the correct matching is: (A) - (IV), (B) - (III), (C) - (II), (D) - (I)