Question
In: Accounting
ABC Limited had offered 500,000 ordinary shares of ksh. 10 each that were payable as follows:...
ABC Limited had offered 500,000 ordinary shares of ksh. 10 each that were payable as follows: On application ksh.4 On allotment Ksh. 5.00 (including premium) On First and final call Ksh 3.00 400 000 applicants were received. All amounts due on allotment and calls were received on due dates except for one member holding 15,000 shares who never paid for the calls. After giving him the time and without success the directors declared the shares for feighted and were later reissued at shs.5.00 each fully paid.
Required: Journal entries/ledgers to record the above transactions.
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Expert Solution
| Date | Particulars | Debit | Credit |
| Bank A/c | 1600000 | ||
| Share Application A/c | 1600000 | ||
| (Application money on 400000 shares @ Ksh 4 per share received) | |||
| Share Application A/c | 1600000 | ||
| Share Capital A/c | 1600000 | ||
| (Application money transferred to share capital) | |||
| Share Allotment A/c | 2000000 | ||
| Share Capital A/c | 1200000 | ||
| Securities Premium A/c | 800000 | ||
| (Money due on allotment of 400000 shares @ Ksh. 3 per share including premium of Ksh . 2)) | |||
| Bank A/c | 1925000 | ||
| Share Allotment A/c | 1925000 | ||
| (Amount received on allotment except 15000 shares @ Ksh 3 per share and 2 on premium) | |||
| Share Final Call A/c | 1200000 | ||
| Share Capital A/c | 1200000 | ||
| (Final call money due) | |||
| Bank A/c | 1155000 | ||
| Calls in arrears | 45000 | ||
| share final Call A/c | 1200000 | ||
| (Final call money received except
that of 15000 shares) |
|||
| Share Capital A/c | 60000 | ||
| securities Premium A/c | 30000 | ||
| share allotment A/c | 45000 | ||
| Calls in arrears | 45000 | ||
| (Being 15000 shares were forfeited on non payment of allotment money and final call) | |||
| Bank A/c | 75000 | ||
| Share Capital A/c | 75000 | ||
| (Being re issue of shares forfeited)15000*5 | |||
| Bank Account | |||
| Particulars | Amount | Particulars | Amount |
| Share Application A/c | 1600000 | ||
| share Allotment A/c | 1925000 | ||
| Share final call A/c | 1155000 | ||
| Share Capital A/c | 75000 | ||
| Share Application A/c | |||
| Particulars | Amount | Particulars | Amount |
| Share Capital A/c | 1600000 | Bank Account | 1600000 |
| Share Allotment A/c | |||
| Particulars | Amount | Particulars | Amount |
| Share Capital A/c | 1200000 | Bank Account | 1925000 |
| Securities Premium A/c | 800000 | securities premium a/c | 30000 |
| share capital A/c | 15000 | ||
| Share final call A/c | |||
| Particulars | Amount | Particulars | Amount |
| Share Capital A/c | 1200000 | Bank Account | 1155000 |
| Calls in arrears A/c | 45000 | ||
| Share Capital A/c | |||
| Particulars | Amount | Pariculars | Amount |
| Share Application A/c | 1600000 | ||
| Share Allotment A/c | 1200000 | ||
| Share final call A/c | 1200000 | ||
| bank Account | 75000 | ||
| Securities Premium Account | |||
| Particulars | Amount | Paticulars | Amount |
| share Allotment A/c | 30000 | Share Allotment A/c | 80000 |
| Calls in arrears A/c | |||
| Particulars | Amount | Particulars | Amount |
| Share final call A/c | 45000 | Share capital A/c | 45000 |
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