Reliable Ltd. was registered with an authorized capital of Rs 20,00,000 in Rs 10 per equity share. It invited applications for issuing 1.00.000 equity shares at a premium of Rs 2 per share. The amount w as pay able as follows:
On application Rs 4 per share (including premium)
On allotment Rs 3 per share
Balance on 1st and Final Call.
Applications were received for 1,30.000 shares. Applications for 10,000 shares were rejected and the application money received on them was refunded. Pro-rata allotment w as made to the remaining applications. Amount overpaid on these applications was adjusted towards the amount due on allotment. Sameer, who had applied for 1,200 shares, failed to pay the allotment and call money. The company forfeited his shares, out of which 800 shares were re-issued to Sanjay at Rs 9 per share fully paid up.
You are required to:
(i) Pass the Journal Entries in the books of the company through Calls in Arrears Account.
(ii) Prepare the Share Allotment Account.
