Page 16 - DCOM201_ACCOUNTING_FOR_COMPANIES_I

Unit 1: Share Capital – Issue of Shares

Solution: Notes

Journal Entries in the Books of X Ltd.
Date Particulars Debit (`) Credit (`)
2006 Jan. 1 Bank A/c Dr. 90,000
To Equity Share Application A/c 90,000
(Being application money received on 9,000
equity shares @ ` 10 per share)
Equity Share Application A/c Dr. 90,000
To Equity Share Capital A/c 90,000
(Being application money transferred to
share capital A/c)
Equity Share Allotment Account Dr. 4,50,000
To Equity Share Capital Account 4,50,000
(Being allotment money due on 9,000
shares @ ` 50 per share)
In the place of above two entries one combined
can be made as:
Equity Share application A/c Dr. 90,000
Equity Share Allotment A/c Dr. 4,50,000
To Equity Share Capital A/c 5,40,000
(Being the transfer of application and allotment money
to share capital A/c on 9,000 shares @ ` 60 per share)
Bank Account Dr. 4,50,000
To Equity Share Allotment Account 4,50,000
(Being allotment money received on 9,000 shares
@ ` 50 per share)
Equity Share First Call Account Dr. 1,80,000
To Equity Share Capital Account 1,80,000
st
(Being 1 call money due on 9,000 shares @ ` 20 per share)
Bank Account Dr. 1,80,000
To Equity Share First Call Account 1,80,000
st
(Being 1 call money received on 9,000 shares @ ` 20
per share)
Equity Share Second & Final Call Account Dr. 1,80,000
To Equity Share Capital Account 1,80,000
(Being 2 nd and final call money due on 9,000 shares @ ` 20
per share)
Bank Account Dr. 1,80,000
To Equity Share Second & Final Call Account 1,80,000
(Being 2nd and final call money received on 9000 shares &
` 20 per share)
Balance Sheet of X Ltd. as on………..

Liabilities ` Assets `
Share Capital : Current Assets :
Cash at bank 9,00,000
Authorised Capital (10,000 equity shares of ` 100 each) 10,00,000
Issued, Subscribed, Called up and Paid up capital
(9,000 equity shares of ` 100 each) 9,00,000
9,00,000 9,00,000

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