Journal entry for forfeiture and reissue of shares.

On 1.1.2008 the directors of ABC CO LTD forfeited 600 equity shares of RS 100 each for non-payments of first call money of Rs 25 per share & final call money of Rs 15 per share . on 1-2-2008, they were reissued at Rs 88 per share as fully paid up. Write the journal entries.

asked Dec 21, 2015 in Company Accounts-Accounting for Share Capital by pooja j (233 points) 20,094 views

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FORFEITURE ENTRY

equity share capital a/c Dr $60000 (600*100)

    to forfeited share a/c $36000(600*60)

    to equity share first calla/c   $15000(600*25)

    to equity share final call a/c $9000(600*15)

[being 600 shares forfeited]

REISSUE ENTRY

bank a/c  Dr $ 52800(600*88)

forfeited shares a/c Dr $7200(600*12)

   to equity share capital a/c 60000(600*100)

[being 600 shares reissued at $88 each]

CREATION OF CAPITAL RESERVE

forfeited shares a/c Dr $28800(600*48)

    to capital reserve a/c $28800 (600*48)

[being balance forfeited share amount transfered to capital reserve a/c]
answered Dec 21, 2015 by Sankari Dkshith B (99 points)
selected Dec 21, 2015 by jbsclasses
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