B Com Exam > B Com Questions > Enoy Ltd. had allotted 10000 shares to applic...
Start Learning for Free
Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve?
Most Upvoted Answer
Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on ...
Accounting Treatment for Forfeiture and Reissue of Shares by Enoy Ltd.
Pro Rata Allotment:
- 10,000 shares were allotted to applicants for 14,000 shares on a pro rata basis.
- Amount payable: Rs. 2 on application, Rs. 5 on allotment (including premium of Rs. 2 each), Rs. 3 on first call, and Rs. 2 on final call.
Forfeiture:
- Vikash failed to pay the first and final calls on his 300 shares.
- All 300 shares were forfeited.
Reissue:
- Out of the forfeited shares, 200 shares were reissued at Rs. 9 per share.
Accounting Treatment:
1. Forfeiture of Shares:
- Debit Vikash's Share Capital account with the amount paid up on his shares (300 x Rs. 2 = Rs. 600).
- Credit Share Forfeiture account with the same amount (Rs. 600).
- Note: The share capital account is reduced because the shares are no longer held by the shareholder.
2. Share Reissue:
- Credit Share Forfeiture account with the nominal value of the shares forfeited but reissued (200 x Rs. 2 = Rs. 400).
- Debit Share Capital account with the same amount (Rs. 400).
- Credit Share Premium account with the premium received on the reissued shares (200 x Rs. 7 = Rs. 1,400).
- Debit Bank account with the total amount received (200 x Rs. 9 = Rs. 1,800).
3. Capital Reserve:
- The excess amount received on reissue (Rs. 1,400 - Rs. 400 = Rs. 1,000) is credited to the Capital Reserve account.
Amount to be credited to Capital Reserve: Rs. 1,000.
Explanation:
- When shares are forfeited, the shareholder loses their rights to the shares and any amount paid up on them.
- The company can then reissue the forfeited shares to new shareholders.
- The amount received on reissue can be used to offset any losses from the forfeited shares or be credited to a capital reserve account.
- In this case, the amount received on reissue (Rs. 1,400) is greater than the nominal value of the shares forfeited but reissued (Rs. 400), resulting in a credit to the Capital Reserve account.
Pro Rata Allotment:
- 10,000 shares were allotted to applicants for 14,000 shares on a pro rata basis.
- Amount payable: Rs. 2 on application, Rs. 5 on allotment (including premium of Rs. 2 each), Rs. 3 on first call, and Rs. 2 on final call.
Forfeiture:
- Vikash failed to pay the first and final calls on his 300 shares.
- All 300 shares were forfeited.
Reissue:
- Out of the forfeited shares, 200 shares were reissued at Rs. 9 per share.
Accounting Treatment:
1. Forfeiture of Shares:
- Debit Vikash's Share Capital account with the amount paid up on his shares (300 x Rs. 2 = Rs. 600).
- Credit Share Forfeiture account with the same amount (Rs. 600).
- Note: The share capital account is reduced because the shares are no longer held by the shareholder.
2. Share Reissue:
- Credit Share Forfeiture account with the nominal value of the shares forfeited but reissued (200 x Rs. 2 = Rs. 400).
- Debit Share Capital account with the same amount (Rs. 400).
- Credit Share Premium account with the premium received on the reissued shares (200 x Rs. 7 = Rs. 1,400).
- Debit Bank account with the total amount received (200 x Rs. 9 = Rs. 1,800).
3. Capital Reserve:
- The excess amount received on reissue (Rs. 1,400 - Rs. 400 = Rs. 1,000) is credited to the Capital Reserve account.
Amount to be credited to Capital Reserve: Rs. 1,000.
Explanation:
- When shares are forfeited, the shareholder loses their rights to the shares and any amount paid up on them.
- The company can then reissue the forfeited shares to new shareholders.
- The amount received on reissue can be used to offset any losses from the forfeited shares or be credited to a capital reserve account.
- In this case, the amount received on reissue (Rs. 1,400) is greater than the nominal value of the shares forfeited but reissued (Rs. 400), resulting in a credit to the Capital Reserve account.
Community Answer
Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on ...
Forfeiture: 300 Shares @3 eachESC a/c Dr 3000 To Calls in Arrears a/c. 1,500 To Share forfeiture a/c 1,500Reissue: 200 Shares @9 each Bank a/c Dr 1,800 Share forfeiture a/c. Dr 200 To ESC 2,000Amount to be credited to CR for 200 reissued shares :Amount forfeited per share = 1,500/300 = ₹5Amount forfeited for 200 reissued share= ₹200*5 Share forfeiture a/c Dr 800 To CR. 800
|
Explore Courses for B Com exam
|
|
Similar B Com Doubts
Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve?
Question Description
Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve?.
Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve?.
Solutions for Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? in English & in Hindi are available as part of our courses for B Com.
Download more important topics, notes, lectures and mock test series for B Com Exam by signing up for free.
Here you can find the meaning of Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? defined & explained in the simplest way possible. Besides giving the explanation of
Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve?, a detailed solution for Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? has been provided alongside types of Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? theory, EduRev gives you an
ample number of questions to practice Enoy Ltd. had allotted 10000 shares to applicants for 14000 shared on a pro rata basis. The amount payable was rs.2 on application,rs.5on allotment (including premium of rs.2 each,rs.3 on first call and rs.2 on final call.Vikash failed to pay the first nd final calls on his 300 shares.All the shares were forfeited out of them 200 shares were reissued @ rs.9 per share. Give the accounting treatment and also state the amount to be credited to capital reserve? tests, examples and also practice B Com tests.
|
|
Explore Courses for B Com exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup