Pure Products Ltd. is registered with authorised capital of ₹ 10,00,000 divided into 1,00,000 equity shares of ₹ 10 each
Pure Products Ltd. is registered with authorised capital of ₹ 10,00,000 divided into 1,00,000 equity shares of ₹ 10 each. It issued 70,000 Equity Shares for subscription of ₹ 2 per share, payable ₹ 3 on application, ₹ 5 on allotment and balance on first and final call. It received application money amounting to ₹ 1,89,000.
You are required to:
(i) Determine whether the company should allot shares; and
(ii) If yes, pass the necessary Journal entries assuming that the company has received due amount on allotment and call.
Anurag Pathak Changed status to publish September 1, 2023
Solution:-
(i) Minimum subscription is 70,000 × 90% = 63,000 shares. The application is received ₹ 1,89,000
Thus number of shares on which application is received is
1,89,000/3 = 63,000 shares.
Thus the company should allot the shares to the subscribers.
(ii)
Anurag Pathak Changed status to publish September 1, 2023