Ownclasses

KS Ltd invited application for issuing 1,60,000 equity shares of ₹ 10 each at a premium of 6 per share. The amount was payable as follows;
On Application ₹ 4 per share (including premium ₹ 1 per share)
On Allotment ₹ 6 per share (including premium ₹3 per share)
On First and Final Call – Balance
Application for 3,20,000 shares were received. Applications for 80,000 share were rejected and application money refunded. Shares were allotted on pro-rata basis to the remaining applicants. Excess money received with application was adjusted towards sums due on allotment. Jain holding 800 shares failed to pay the allotment money his shares were forfeited immediately after allotment. Afterwards, the final call was made. Gupta who has applied for 1200 shares failed to pay the final call. These shares were forfeited. Out of the forfeited shares 1000 shares were re-issued at 8 per share fully paid up. The re-issued shares included all the forfeited shares of Jain Pass necessary journal entries for the above transactions in the books of KS Ltd


Answer




Calculation of amount unpaid on Allotment


Calculation of Capital Reserve
(i) 800 Shares of Jain are reissued
Share forfeiture (Cr.)              = 4,000
    Less:Share forfeiture (Dr.) = 1600(800 x 2)
Capital Reserve                    = 2400

(ii) 200 Shares of Gupta are reissued
 Share space Foreiture left parenthesis Cr. right parenthesis space for space 200 space shares space equals space 1200 open parentheses 4800 over 800 cross times 200 close parentheses
space space Less colon space Share space Forfeiture left parenthesis Dr. right parenthesis space space space space space space equals space 400 space left parenthesis 200 space cross times space 2 right parenthesis
Capital space Reserve space space space space space space space space space space space space space space space space space space space space space space space equals space 800
Total space Amount space of space Capital space Reserve space equals 3 comma 200 left parenthesis 2400 plus 800 right parenthesis