Question

X Ltd. issued 10,000 equity shares of Rs 10 each at a premium of Rs 2 per share. Amount payable: Rs 4 on application, Rs 5 on allotment (including premium), and Rs 3 on first & final call. All shares were subscribed and money received. Pass journal entries.

Hint:

Premium is credited to Securities Premium A/c. Record share transactions in correct sequence: application → allotment → calls.

Answer 1

Step 1: On receipt of application money \[ \text{Bank A/c} \quad Dr. \quad Rs 40,000
\quad \quad \text{To Share Application A/c} \quad Rs 40,000 \] Step 2: On transfer of application money \[ \text{Share Application A/c} \quad Dr. \quad Rs 40,000
\quad \quad \text{To Share Capital A/c} \quad Rs 40,000 \] Step 3: On allotment due (Rs 3 Capital + Rs 2 Premium) \[ \text{Share Allotment A/c} \quad Dr. \quad Rs 50,000
\quad \quad \text{To Share Capital A/c} \quad Rs 30,000
\quad \quad \text{To Securities Premium A/c} \quad Rs 20,000 \] Step 4: On receipt of allotment \[ \text{Bank A/c} \quad Dr. \quad Rs 50,000
\quad \quad \text{To Share Allotment A/c} \quad Rs 50,000 \] Step 5: On first & final call due \[ \text{Share First & Final Call A/c} \quad Dr. \quad Rs 30,000
\quad \quad \text{To Share Capital A/c} \quad Rs 30,000 \] Step 6: On receipt of first & final call \[ \text{Bank A/c} \quad Dr. \quad Rs 30,000
\quad \quad \text{To Share First & Final Call A/c} \quad Rs 30,000 \] Final Answer: \[ \boxed{\text{All money received and shares fully allotted with Rs 2 premium per share.}} \]