Konark Ltd. invited applications for issuing 3,00,000 shares of ₹ 10 each. The amount per share was payable as follows: ₹ 3 on application, ₹ 3 on allotment, and ₹ 4 on first and final call.
The company received applications for 4,00,000 shares. Allotment was done as follows:
(i) Applicants of 2,40,000 shares were allotted 2,00,000 shares.
(ii) Applicants of 1,20,000 shares were allotted 80,000 shares.
(iii) Remaining applicants were allotted 20,000 shares.
Money overpaid on applications was adjusted towards sums due on allotment. Divji, a sharehlder, belonging to group (ii), who had applied for 6,000 shares, failed to pay allotment and call money, Faisal, another shareholder, who was allotted 10,000 shares, paid the call money along with allotment. Faisal belonged to group (i).
Divji’s shares were forfeited after the first and final call. Half of the forfeited shares were reissued @ ₹ 10 per share fully paid.
Pass the necessary Journal entries to record the above transactions in the books of the company.
[Ans.: Allotment Amount received – ₹ 5,94,000; Capital Reserve – ₹ 9,000.]