A Ltd. invited applications for issuing 80,000 equity shares of 10 each at a premium of 4 per share. The amount was payable as follows:

On application – 5 per share

On allotment – 9 per share (premium included)

Applications were received for 1,40,000 shares and allotment was made to all applicants on pro-rata basis. Money overpaid on applications was adjusted towards sum due on allotment. Rajiv, who had applied for 1,400 shares failed to pay the allotment money. His shares were forfeited. 

Later on, these forfeited shares were reissued at 9 per share as fully paid up.

Pass the necessary journal entries in the books of A Ltd. for the above transactions. 

Marks-8, CBSE:2019-20/Compartment/Q-21*

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