Delhi Chemicals Ltd. was registered with an authorised capital of ₹15,00,000; consisting of 1,50,000 Equity shares of ₹10 each. The company issued a prospectus inviting applications for 60,000 shares at a premium of ₹2 p

CS Executive · Company Accounts & Auditing Practices · PYQS · June 2017
Delhi Chemicals Ltd. was registered with an authorised capital of ₹15,00,000; consisting of 1,50,000 Equity shares of ₹10 each. The company issued a prospectus inviting applications for 60,000 shares at a premium of ₹2 per share, payable as under: On application: ₹2 On allotment: ₹5 (including Premium) On first & final call: ₹5 Applications were received for 80,000 shares. Letters of regret were sent with the refund orders to the applicants of 12,000 shares. Pro rata allotment was made on the balance. Excess money received on applications were utilised towards the allotment money. Pass the necessary entries in the Journal of the company and also prepare the required note of 'Share Capital' in accordance with the provisions of Schedule-III of Companies Act, 2013.

Answer & Explanation:

In the Books of Delhi Chemicals Ltd. Journal Entries Particulars Amt. (Dr.) Amt. (Cr.) 1) Bank A/c Dr. 1,60,000 To Equity Share Application A/c 1,60,000 (Being Application Money Received) 2) Equity Share Application A/c Dr. 1,60,000 To Bank A/c 24,000 To Equity Share Capital A/c 1,20,000 To Equity Share Allotment A/c 16,000 (Being Application Money due) 3) Equity share Allotment A/c Dr. 3,00,000 To Equity Share Capital A/c 1,80,000 To Securities Premium A/c 1,20,000 (Being Allotment Money Due) 4) Bank A/c Dr. 2,84,000 To Equity Share Allotment A/c 2,84,000 (Being Allotment Money Received) 5) Equity Share First and Final Call A/c Dr. 3,00,000 To Equity share capital A/c 3,00,000 (Being First & Final Call due) 6) Bank A/c Dr. 3,00,000 To Equity Share First & Final Call A/c 3,00,000 (Being First & Final Call Received) Note: 1 Share Capital Authorised Capital 1,50,000 Equity Shares of ₹10 each: ₹15,00,000 Issued Subscribed & Paid up Capital 60,000 Equity Shares of ₹10 each, fully paid: ₹6,00,000

Topics: Share Capital

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