Question

R Ltd. invited applications for 20,000 shares of Rs. 10 each payable as follows: Rs. 3 on application, Rs. 2 on allotment, Rs. 2.50 on first call, and Rs. 2.50 on second call.
Public applied for 30,000 shares, and allotments were made as under:
1. To applicants for 8,000 shares: Full allotment.
2. To applicants for 16,000 shares: 12,000 shares allotted.
3. To applicants for 6,000 shares: Nil allotment.
All money was duly received. Pass journal entries.

Hint:

Always adjust oversubscription amounts against share allotment or refund the excess, ensuring proper accounting entries for all calls.

Answer 1

Journal Entries:\[\begin{array}{|l|l|r|r|} \hline Date & Particulars & Dr. (Rs.) & Cr. (Rs.) \\ \hline \text{--} & \text{Bank A/c Dr.} & \text{90,000} \\   \text{} & \text{\hspace{0.5cm} To Share Application A/c} &  \text{} & \text{90,000} \\ \hline \text{--} & \text{Share Application A/c Dr.} & \text{90,000} \\ \text{} & \text{\hspace{0.5cm} To Share Capital A/c} &  \text{} & \text{60,000} \\ \text{} & \text{\hspace{0.5cm} To Share Allotment A/c} &  \text{} & \text{30,000} \\ \hline \text{--} & \text{Bank A/c Dr.} & \text{40,000} \\  \text{} & \text{\hspace{0.5cm} To Share Allotment A/c} &  \text{} & \text{40,000} \\ \hline \text{--} & \text{Share Allotment A/c Dr.} & \text{40,000} \\ \text{} & \text{\hspace{0.5cm} To Share Capital A/c} &  \text{} & \text{40,000} \\ \hline \text{--} & \text{Bank A/c Dr.} & \text{50,000} \\ \text{} & \text{\hspace{0.5cm} To Share First Call A/c} &  \text{} & \text{50,000} \\ \hline \text{--} & \text{Share First Call A/c Dr.} & \text{50,000} \\ \text{} & \text{\hspace{0.5cm} To Share Capital A/c} &  \text{} & \text{50,000} \\ \hline \text{--} & \text{Bank A/c Dr.} & \text{50,000} \\ \text{} & \text{\hspace{0.5cm} To Share Second Call A/c} &  \text{} & \text{50,000} \\ \hline \text{--} & \text{Share Second Call A/c Dr.} & \text{50,000} \\ \text{} & \text{\hspace{0.5cm} To Share Capital A/c} &  \text{} & \text{50,000} \\ \hline \end{array}\]

Explanation 

1. Money received on applications (Rs. 90,000) was adjusted towards the share capital (Rs. 60,000) and allotment (Rs. 30,000). 

2. Subsequent calls for allotment, first call, and second call were received and adjusted against the share capital.