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CBSE CLASS XII

Company Account : Accounting for Share Capital

Q. 50. Suman Ltd., registered with a nominal capital of Rs.10,00,000 divided in 1,00,000 equity shares of Rs.10 each. Out of these 20,000 equity shares were issued to the vendor as fully paid as purchase consideration for a building acquired. 65,000 equity shares were offered to the public and of these 60,000 equity shares were applied for and allotted. The directors called Rs.6 per share and received the entire amount except a call of Rs.2 per share on 5,000 equity shares. How would you show the relevant items in the Balance Sheet of Suman Ltd.?

Q. 51. Black and White Ltd. offered 1,00,000 shares of Rs.10 each to the public on the following terms: Rs.3 to be paid on application; Rs.2 to be paid on allotment; Rs.2 to be paid two months after allotment; and Rs.3 to be paid three months after the first call. The public applied for 90,000 shares which were allotted, the allotment taking place on 1st may,2007. All money due on allotment was received by the 15th May,2007. Calls were duly made but a shareholder holding 1,500 shares failed to pay the calls. Make entries in the Cash Book, the journal and the ledger of the company, also give the Balance Sheet.

Q. 52. On 1st January, 2007, A Ltd. makes an issue of 10,000 equity shares of Rs.10 each payable as: on application Rs.3; on allotment Rs.3; on first and final call Rs.4 (three months after allotment). Application were received for 13,000 shares and directors made allotment in full to the applicant demanding five or more shares and returned money to the applicants for 3,000 shares. One shareholder, who was allotted 200 shares, paid first and final call with allotment money and another shareholder did not pay allotment money on his 300 shares but which he paid with first and final call. Directors have decided to charge and allow interest, as the case may be, on Calls-in-Advance respectively according to the provisions of Table A. Journalise the transactions including cash transactions.

Q. 53. X ltd. purchased the business of Ram Bros. for Rs.1,80,000 payable in fully paid equity shares of Rs.100 each. What entries will be made in the books of X Ltd. if such issue is: (i) at par (ii) at a premium of 20% and (iii) at a discount of 10%?

Q. 54. A company purchased a running business from M/s. Maheshwari Brothers for a sum of Rs.1,50,000 payable as Rs.1,20,000 in fully paid Equity shares of Rs.10 each and balance in cash. The assets and liabilities consisted of the following:

You are required to pass the necessary journal entries in the company’s books.

Q. 55. A limited company was registered with an authorized capital of Rs.2,00,000 in Rs.10 per Equity share, of these 6,000 Equity shares issued as fully paid to the vendors for the purchase of building 8,000 Equity shares were subscribed for by the public and during the first year Rs.5 per Equity share were called up, payable Rs.2 on application, Re.1 on allotment, Re.1 on first call and Re.1 on second call. The amounts received in respect of these shares were as follows:

On 6,000 Equity shares the full amount called.
On 1,250 shares Rs.4 per Equity shares.
On 500 shares Rs.3 per Equity shares.
On 250 shares Rs.2 per Equity shares.

The directors forfeited 750 Equity shares on which less than Rs.4 per Equity share had been paid. Show journal entries in the books of the company and also show the share capital as it would appear in the Balance Sheet.

Paper By Mr. Rahul Kadd
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