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Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures?
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Samuel who was the holder of 12,000 preference shares of Rs.100 each, ...
Journal Entries to Record Forfeiture and Re-issue of Shares
There are two transactions that need to be recorded in the books of the company: forfeiture of shares held by Samuel and re-issue of a portion of the forfeited shares to Mr. Robert.
Forfeiture of Shares
The forfeiture of shares held by Samuel involves the following journal entries:
1. To record the forfeiture of shares:
Debit: Share Forfeiture Account (12,000 x Rs.75)
Credit: Preference Share Capital Account (12,000 x Rs.100)
Credit: Share Allotment Account (12,000 x Rs.25)
Credit: Share First Call Account (12,000 x Rs.25)
2. To record the re-issue of forfeited shares:
Debit: Share Forfeiture Account (2,000 x Rs.75)
Debit: Share Capital Reserve Account (2,000 x Rs.10)
Credit: Preference Share Capital Account (2,000 x Rs.100)
Credit: Share Re-issue Account (2,000 x Rs.65)
Re-issue of Shares
The re-issue of forfeited shares to Mr. Robert involves the following journal entries:
1. To record the receipt of application money:
Debit: Bank Account
Credit: Share Application Account (10,000 x Rs.5)
2. To record the allotment of shares:
Debit: Share Application Account (10,000 x Rs.5)
Credit: Share Allotment Account (10,000 x Rs.25)
3. To record the payment of first and final call:
Debit: Share First Call Account (10,000 x Rs.25)
Debit: Share Final Call Account (10,000 x Rs.10)
Credit: Share Capital Account (10,000 x Rs.75)
Conclusion
In conclusion, the forfeiture and re-issue of shares involve several journal entries that need to be recorded in the books of the company. These entries include the forfeiture of shares held by Samuel, the re-issue of forfeited shares to Mr. Robert, and the receipt and payment of application money, allotment, and first and final call. By recording these transactions accurately, the company can maintain an up-to-date record of its share capital and ensure compliance with relevant laws and regulations.
There are two transactions that need to be recorded in the books of the company: forfeiture of shares held by Samuel and re-issue of a portion of the forfeited shares to Mr. Robert.
Forfeiture of Shares
The forfeiture of shares held by Samuel involves the following journal entries:
1. To record the forfeiture of shares:
Debit: Share Forfeiture Account (12,000 x Rs.75)
Credit: Preference Share Capital Account (12,000 x Rs.100)
Credit: Share Allotment Account (12,000 x Rs.25)
Credit: Share First Call Account (12,000 x Rs.25)
2. To record the re-issue of forfeited shares:
Debit: Share Forfeiture Account (2,000 x Rs.75)
Debit: Share Capital Reserve Account (2,000 x Rs.10)
Credit: Preference Share Capital Account (2,000 x Rs.100)
Credit: Share Re-issue Account (2,000 x Rs.65)
Re-issue of Shares
The re-issue of forfeited shares to Mr. Robert involves the following journal entries:
1. To record the receipt of application money:
Debit: Bank Account
Credit: Share Application Account (10,000 x Rs.5)
2. To record the allotment of shares:
Debit: Share Application Account (10,000 x Rs.5)
Credit: Share Allotment Account (10,000 x Rs.25)
3. To record the payment of first and final call:
Debit: Share First Call Account (10,000 x Rs.25)
Debit: Share Final Call Account (10,000 x Rs.10)
Credit: Share Capital Account (10,000 x Rs.75)
Conclusion
In conclusion, the forfeiture and re-issue of shares involve several journal entries that need to be recorded in the books of the company. These entries include the forfeiture of shares held by Samuel, the re-issue of forfeited shares to Mr. Robert, and the receipt and payment of application money, allotment, and first and final call. By recording these transactions accurately, the company can maintain an up-to-date record of its share capital and ensure compliance with relevant laws and regulations.
Community Answer
Samuel who was the holder of 12,000 preference shares of Rs.100 each, ...
Share capital a\c dr 900000
To P share allotment a\c 300000
To P share first call a\c 300000
To P share forfeiture a\c300000
Bank a\c dr 650000
p Share forfeiture a\c dr 100000
To P share capital a\c750000
Share forfeiture a\c dr 150000
To capital reserve a\c 15000
To P share allotment a\c 300000
To P share first call a\c 300000
To P share forfeiture a\c300000
Bank a\c dr 650000
p Share forfeiture a\c dr 100000
To P share capital a\c750000
Share forfeiture a\c dr 150000
To capital reserve a\c 15000
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Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures?
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Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures?.
Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures?.
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Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures?, a detailed solution for Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures? has been provided alongside types of Samuel who was the holder of 12,000 preference shares of Rs.100 each, on which Rs.75 per share has been called up could not pay his dues on Allotment and First call each at Rs.25 per share. The Directors forfeited the above shares and reissued 10,000 of such shares to Mr. Robert at Rs.65 per share paid-up as Rs.75 per share .You are required to prepare journal entries to record the above forfeiture and re-issue in the books of the company Issue of Debentures? theory, EduRev gives you an
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