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8.6 Double Entry Book Keeping—CBSE XII

Solved Questions

Illustration 1 (Comprehensive Illustration).
Paliwal Exports Ltd. with a share capital of ` 1,00,000 divided into 2,000 Equity Shares of ` 50
each offers Equity Shares to the public as follows:
` 10 payable on application, ` 10 payable on allotment, ` 15 payable on first call and ` 15
payable on second call.
Shareholder ‘A’ who holds 30 Equity Shares has paid only application money.
Shareholder ‘B’ who holds 20 Equity Shares has paid application money on 20 Equity Shares
and allotment money on only 10 Equity Shares. He has not paid any other calls.
Shareholder ‘C’ who holds 18 Equity Shares has paid only application and allotment money.
Shareholder ‘D’ who holds 5 Equity Shares has paid application, allotment and first call money.
Shareholder ‘E’ who holds 3 Equity Shares has paid application, allotment and first call money
in full and second call money on only 2 Equity Shares.
The company forfeits the shares of the above shareholders who have not paid the arrears.
Journalise above transactions including entries relating to Bank in the books of Paliwal Exports Ltd.

Solution: JOURNAL
Date Particulars L.F. Dr. (`) Cr. (`)
Bank A/c ...Dr. 20,000
To Shares Application A/c 20,000
(Application money received on 2,000 shares)
Shares Application A/c ...Dr. 20,000
To Share Capital A/c 20,000
(Transfer of application money on 2,000 shares to
Share Capital Account)
Shares Allotment A/c ...Dr. 20,000
To Share Capital A/c 20,000
(Allotment money due on 2,000 shares)
Bank A/c ...Dr. 19,600
To Shares Allotment A/c 19,600
(Allotment money received on 1,960 shares)
Shares First Call A/c ...Dr. 30,000
To Share Capital A/c 30,000
(First call money due on 2,000 shares)
Bank A/c ...Dr. 28,980
To Shares First Call A/c 28,980
(First call money received on 1,932 shares)
Shares Second and Final Call A/c ...Dr. 30,000
To Shares Capital A/c 30,000
(Second and final call money due on 2,000 shares)