Page 60 - DCOM201_ACCOUNTING_FOR_COMPANIES_I

Unit 2: Forfeiture of Shares

(ii) Amount of premium has not been received on such forfeited shares. Notes
3. X Ltd. forfeited 500 shares of 100 each on which final call of 30 per share has not been
received. Other calls have been duly received. Make journal entry to record the forfeiture
of shares.
4. All Time Entertainment Ltd. issued 50000 shares of 10 each at a premium of 4 per share
payable as 3 per share on application 7 (including premium) on allotment and the
balance on call. Akbar who was allotted 300 shares failed to pay the allotment amount and
on his subsequent failure to pay the call money his shares were forfeited. Make the journal
entry for the forfeiture of 300 shares.
5. Exe Ltd issued 10000 shares of 50 per share issued at a discount of 5 per share payable
as 10 per share on application, 20 per share on allotment and the balance on call. All
money was duly received except of 400 shares on which allotment and call money was not
received. These shares were forfeited. Make journal entries in the books of the company
and prepare ledger accounts also.

Answers: Self Assessment

1. Forfeit 2. Articles of Association
3. Fourteen 4. Credited by 700
5. Credited by 2000 6. Debited by 200
7. Credited by 400

2.7 Further Reading

Books Corporate Accounting - Dr. K.K. Verma

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