Calls in Arrears Video Lecture | Accountancy Class 12 - Commerce

calls in areas when a call is made but
the money is not received that amount is
said to be calls in areas for example if
we pass chef call account do we pass an
entry saying she'll call account debit
to share capital to make it do let us
say the amount is 1 lakh that is also
assumed that one shareholder who is to
pay five thousand rupees
does not pay what would be the entry
then the entry would be bank account
debit we receive five thousand less so
we receive only ninety five thousand
bank account debit ninety five thousand
to share four ninety five thousand as a
result of this there is a balance in the
shell call account of five thousand
which is nothing but a call in ten years
so a debit balance in a call account
till the share allotment account in the
share first call account in the share
second column count all the share third
column gown represents call in air here
we may leave it like this or we may
transfer the balance in the call account
to calls in areas the entry in that case
would be calls an area account debit
calls in area account of it to share
call account cause an area account debit
to share call account amount of five
thousand with this the share call
account gets closed so calls in areas
may be created the account may be
created if it is not created the debit
balance
share a lot mem for any call account
would represent calls in areas calls in
areas to share call account how is this
shown in the balance sheet in the
balance sheet share capital account
actually we have called up capital less
we say calls and Elias calls an area is
a debit balance it is shown as a
deduction from the liability set so
called a capital so much calls an edu so
much the amount which is shown outside
this is actually the paid up capital
dividend is usually paid on the paid up
capital for calls in arrears interest
may be charged the maximum rate of
interest being 5% per annum
if money is received later on then the
entry becomes bank account debit to
calls in 10 years therefore what are
calls in areas when a call is move made
but the money is not received that money
which is not be you see is said to be
calls in heaviness the debit balance in
any of the calls are put represent calls
in areas alternatively we can pass an
accounting entry transfer it from the
call account to an account called calls
in areas calls an area account debit to
the respective call account this call in
area is a debit balance and is shown as
a deduction as a deduction from the
share capital therefore we get the
actual paid up capital called up is the
full amount which is being called up
less calls in areas gives us paid up
capital the interest may be charged from
the shareholder the maximum rate of in
first as per react is 5% let us consider
this example XYZ limited issue 1 lakh
shares of 10 each payable as to on
application 5 on allotment including
premium and 4 on the first and final
call so that's 5 + 2 7 8 9 10 11 we are
talking of a share being issued at a
premium of rupee 1 per ship all the
money was received except for a
shareholder holding 1,000 shares who did
not pay up the corn money past journal
actions so what would be the entries
first we receive money on receipt of
money
what is the entry on receipt of money
money comes in therefore bank account
debit to share application how much is
this he should one lakh shares of 10
each payable as rupees 2 on applications
1 lakh into to be dead 2 lakhs one lakh
shares into 2 on allotment of shares on
allotment of shares what happens the
share application is capitalized so
share application account debit to share
capital share application account debit
to share capital with how much same
amount 1 lakh in book 2 2 lakhs on
allotment of shares a lot when money
also becomes you therefore the entry
would be
share allotment account debit to share
capital how much is this five per
five per share but including premium so
the entry would be share a lot length
account debit to share capital to
securities premium how much is this this
is 1 lakh share into five is the total
money due there for 5 lakh how much is
capitalized one leg into 4 that's for
luck and 1 lakh into 1 1 lakh is the
securities premium this is because this
is the face value of rupees 10 each the
total amount which is being issued for
is 2 plus 5 plus 4 which is equal to 11
therefore rupee 1 is the premium amount
so on allotment of shares we have two
entry capitalization of the application
money and a lot with money chip on
receipt of allotment money on receipt of
allotment money what would be the entry
money comes in so bank account debit to
share allotments entire money has been
received therefore entire 5 lakhs has
been received finally call money is due
what is the call money for per shape so
entry call money do what is the entry
and the call is made entry is share
final call account debit to shake
what is the amount here we are talking
of four per share into one lakh shares
there for 4 lakhs on receipt of money
bank account debit we receive all the
money except a shareholder holding 1000
shares so 1000 into for 4000 is not
received balance is received so what we
receive is for lat - four thousand three
lakh 96,000 we can transfer this to
calls an area and combining the entry
calls an area account debit four
thousand to share final call account for
lap with this the final call account
gets closed and this calls an area would
be shown in the balance sheet how would
it be sure share capital if we note this
comes to 10 lakhs 10 lakhs share capital
is 2 lakh plus for luck + foler 10 lakh
so in the balance sheet we would show 10
lakhs less calls in areas 4009 lakh
96,000