17 May 2012
1. There shall not be any entry in the books for increase in the Authorised Share Capital. There is no financial transaction taking place when a company raises its Auth. Share Capital. It just means that the company is 'authorised' to raise that amount as share capital.
2. When the Managing Director paid Rs 6 lacs towards further share capital, the entry shall be same as it was in the first case. No change... (Except that it will be debited to bank if the amount was received thro' bank):
Bank/Cash - Dr. To Share Capital - Cr.
3. What has the third party paid for? If its towards acquiring qualifying shares, the entry will again be same as above.
17 May 2012
It is a fact that there is no entry of autorised capital, but one has to pay due consideration to the fact that alloted share capital should in no case be more than authorised capital. So if subscribed capital is more than authorised capital then in that case your authorised and paid up capital will remain same and rest will remain "share application money pending allotment" Therefore if ur total authorised capital after enhancement is 7 lacs, ur paid up capital will be 7 lacs and share application money pending allotment will be Rs.1000.
17 May 2012
thanks to both experts in my case Auth. capaital increases to 25.00 lac then in balance sheet 11-12 to show
then Auth. capital 25.00 lac issued, subscribed paid up capital Rs. 701000.00 lac (share application money 1000/- will be included in return of allotment using with Form 2)
CAclubindia
