Practical Problem 01
Practical problem | Q 1 | Page 341
1) Vijay Ltd. was registered with an authorised capital of ₹ 15,00,000 divided into 1,50,000 equity shares of ₹ 10 each. Company issued 1,00,000 equity shares of ₹ 10 each at a premium of ₹ 2 per share.
Company received applications for 80,000 equity shares and were allotted the shares.
Company received application money ₹ 3 per share, allotment money ₹ 4 per share (Including premium), and first call money ₹ 3 per share.
The Directors have not made final call of ₹ 2 per share. All money were received except one shareholder holding 500 shares did not pay first call.
Show Authorised Capital, Issued Capital, Subscribed Capital, Called-up Capital, Paid-up Capital, Calls in Arrears, and Share Premium amount in company balance sheet.
SOLUTION:
In the books of Vijay Ltd.
Balance Sheet as on ———————-
Liabilities | Amount | Assets | Amount | |
Authorised Capital : | Cash at Bank | 7,98,500 | ||
1,50,000 equity shares of ₹10 each | 15,00,000 | |||
Issued Capital : | ||||
1,00,000 equity shares of ₹10 each | 10,00,000 | |||
Subscribed Capital : | ||||
80,000 equity shares of ₹10 each | 8,00,000 | |||
Called-up Capital : | ||||
80,000 equity shares of ₹ 8 each | 6,40,000 | |||
Paid-up Share Capital : | ||||
(80,000 equity shares at 8 per shares) | 6,40,000 | |||
Less: Calls-in-Arrears (500 shares at ₹3 per share) | 1,500 | 6,38,500 | ||
Share Premium / Securities A/c (80,000 shares at ₹2 per share) | 1,60,000 | |||
7,98,500 | 7,98,500 | |||
Working Notes :
(1) Bank balance at the end = Amount received on application + Amount received on allotment + Amount received on 1st call + Premium amount received
= 80,000 × 3 + 80,000 × 2 × 79,500 × 3 + 80,000 × 2
= 2,40,000 + 1,60,000 + 2,38,500 + 1,60,000
= ₹ 7,98,500
(2) Directors have not made final call of ₹ 2 per share means total called-up amount = ₹ 10 – ₹ 2 = ₹ 8
(3) Calls-in-Arrears → on 500 shares at ₹ 3 = ₹ 1,500 of first call
(4) Share premium on 80,000 shares @ ₹ 2 received at allotment stage i.e. share premium amount = 80,000 × ₹ 2 = ₹ 1,60,000