Page 174 - ISCDEBK-12

7.10 Double Entry Book Keeping (Section A)—ISC XII

Dr. SHARE CAPITAL ACCOUNT Cr.
Particulars ` Particulars `
To Balance c/d 2,00,000 By Shares Application A/c 1,00,000
By Shares Allotment A/c 1,00,000
2,00,000 2,00,000
By Balance b/d 2,00,000

BALANCE SHEET (EXTRACT) as at 31st March, 2018
Particulars Note No. `
I. EQUITY AND LIABILITIES
Shareholders’ Funds
Share Capital 1 2,00,000
Total 2,00,000
II. ASSETS
Current Assets
Cash and Bank Balances 2 2,00,000
Total 2,00,000

Notes to Accounts
1. Share Capital `
Authorised Capital
50,000 Equity Shares of ` 10 each 5,00,000
Issued Capital
20,000 Equity Shares of ` 10 each 2,00,000
Subscribed Capital
Subscribed and fully paid-up
20,000 Equity Shares of ` 10 each 2,00,000
2. Cash and Bank Balances
Cash at Bank 2,00,000
Illustration 8 (Issue of Shares at Premium, Oversubscription of Shares).
Hightech Ltd. issued 50,000 Equity Shares of ` 10 each at a premium of ` 4 per share
payable ` 4 on application; ` 8 on allotment and balance on final call.
Applications were received for 80,000 shares. Applications for 18,000 shares were rejected
and the amount was refunded. Excess application money was applied towards amount
due on allotment. The amounts due were received.
Pass necessary Journal entries for the above transactions.
Solution: In the Books of Hightech Ltd.
JOURNAL
Date Particulars L.F. Dr. (`) Cr. (`)
Bank A/c ...Dr. 3,20,000
To Equity Shares Application A/c 3,20,000
(Being the application money received on 80,000 shares @ ` 4)
Equity Shares Application A/c ...Dr. 3,20,000
To Equity Share Capital A/c 2,00,000
To Equity Shares Allotment A/c 48,000
To Bank A/c (18,000 × ` 4) 72,000
(Being 50,000 shares allotted, excess application money
adjusted towards allotment and application money on rejected
applications refunded)