Question

29 $1191291 411 shares paybale- 1 on application, 72 on allotment, 73 on first call and 4 on final call. Applications we A company was formed with a capital of 15,00,000 in the share of 10 each. It offered to the public 1,009 shareholder holding 200 shares, who failed to pay final call money. These shares were subsequently forfeited and received for 90,000 shares and the shares were accordingly allotted. All the money was duly received except resold for ? 8 per share. Give journal entries for the above transactions Ans. Capital Reserve Account ? 800 ​

Answer 1

The journal entries for the transactions include detailed explanations and calculations. There is also a specific entry for the capital reserve account.

Step-by-step explanation:

The journal entries for the transactions described can be summarized as follows:

1. On the application: Debit - Cash (1 x $10) and Credit - Share Capital (1 x $10)
2. On the allotment: Debit - Cash (72 x $10) and Credit - Share Capital (72 x $10)
3. On the first call: Debit - Cash (73 x $10) and Credit - Share Capital (73 x $10)
4. On the final call: Debit - Cash (4 x $10) and Credit - Share Capital (4 x $10)
5. Forfeiture of shares: Debit - Share Capital (1,009 x $10) and Credit - Capital Reserve Account (1,009 x $8)
6. Reissue of forfeited shares: Debit - Capital Reserve Account (1,009 x $8) and Credit - Share Capital (1,009 x $10)

The final journal entry would include the calculation of a capital reserve:

1. Capital Reserve Account: Debit - Capital Reserve Account (90,000 shares x $2) and Credit - Capital Reserve Account ($180,000)