KS Ltd. Invited applications for issuing 1,60,000 equity shares of Rs. 10 each
Channel: Doubtnut
Date: 2020-04-26

KS Ltd. Invited applications for issuing 1,60,000 equity shares of Rs. 10 each at a premium  of Rs. 6 per share. The amount was payable as follows :  On Application - Rs. 4 per share (including premium Rs. 1 per share)  On Allotment - Rs. 6 per share (including premium Rs. 3 per share)  On First and Final Call - Balance.  Applications for 3,20,000 shares were received. applicatons for 80,000 shares were rejected and application money refunded. Shares were allotted on pro-rata basis to the remaining applicants. Excess money received with applications was adjusted towards sums due on allotment. Jain holding 800 shares, failed to pay the allotment money. His shares were forfeited immediately after allotment. Afterwards the final call was made. Gupta who had appled for 1,200 shares failed to pay the final call. These shares were also forfeited. Out of the forfeited shares 1,000 shares were re-issued at Rs. 8 per share fully paid up. The re-issued shares included all the forfeited shares of Jain.  Assuming that the Company maintains Calls in Arrears Account, pass necessary Journal entries for the above transactions in the books of KS Ltd.