Use app×
Join Bloom Tuition
One on One Online Tuition
JEE MAIN 2025 Foundation Course
NEET 2025 Foundation Course
CLASS 12 FOUNDATION COURSE
CLASS 10 FOUNDATION COURSE
CLASS 9 FOUNDATION COURSE
CLASS 8 FOUNDATION COURSE
0 votes
8.6k views
in Accounts by (46.2k points)
closed by

Mitra Ltd. invited applications from the public for the issue of 60,000 shares of Rs 10 each, at a discount of 10%, payable as ;

Rs 3 per share on application. 

Rs 5 per share on allotment.

Balance on call.

The public subscribed for 50,000 shares Rs 2,49,000 were received by the company on allotment and Rs 49,400 on call. The company forfeited those shares on which both, allotment and call money was not received. 7% of the forfeited shares were reissued at Rs 7 per share, hilly called up.

The company had Rs 45,000 in its Security Premium Reserve Account which it used to write off any miscellaneous expenditure incurred during the year.

You are required to pass the necessary journal entries to record the above transactions.

1 Answer

+1 vote
by (49.5k points)
selected by
 
Best answer

Working Notes:

Amount forfeited on 200 shares = Rs 600

Hence, amount forfeited on 140 shares = 600 x 140 / 200 = 420

Therefore, Capital Reserve = Rs 420 - 280 = Rs 140.

Welcome to Sarthaks eConnect: A unique platform where students can interact with teachers/experts/students to get solutions to their queries. Students (upto class 10+2) preparing for All Government Exams, CBSE Board Exam, ICSE Board Exam, State Board Exam, JEE (Mains+Advance) and NEET can ask questions from any subject and get quick answers by subject teachers/ experts/mentors/students.

Categories

...