Sarthaks Test
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Ashoka Limited Company which had issued equity shares of Rs.20 each at a discount of Rs. 4 per share, forfeited 1,000 shares for non-payment of final call of Rs.4 per share. 400 of the forfeited shares are reissued at Rs.14 per share out of the remaining shares of 200 shares reissued at Rs.20 per share. Give journal entries for the forfeiture and reissue of shares and show the amount transferred to capital reserve and the balance in Share Forfeiture Account.

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Working Note :

Calculation of capital reserve

Note : In reissue the amount of discount is adjusted if rate of reissue is less than face value of share .If reissue is at face value or premium then discount of main issue will not be considered on reissue.

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