Menu
Icwai accountancy question dec 2011 - doubt
Replies (4)
Sir, the broad answers for your query are as under:
Gen. Reserve transferred to CRR - 50,000
15000 new shares of Rs.10 each issued at 20%
Amount due to Preference Shareholders - 2,20,000
Payment made to Preference Shareholders - 2,14,500
CRR transferred to Share Capital - 50,000
The question specifically states that they have issued only 14500 shares @ Rs.10 each @ premium of 20% - what is the accounting rule for the 500 shares, which is partly paid up and the whareabouts of the shareholder is not tracable.
Hi! Partly paid pref. shares cannot b redeemed. One option is 2 forfeit d shares or to hold them until they r fully paid up. 1st option looks appropriate as the where abt of that shareholder is not found. so forfeit his shares and redeem d rest.
- The shares shall be forfeited assuming all the necessary steps have been taken for the sake of it.
Share capital a/c …..dr 5,000
To calls in arrear 2,000
To shares forfeited a/c 3,000
- Rs. 50,000 can be used from general reserve for the purpose of redemption of pref shares. So, 15,000 shares shall be issued for further requirement of funds not considering premium of 20% as it is to be considered in further issue of 14,500 shares.
Bank a/c…………dr 1,50,000
To share application 1,50,000
Share application……..dr 1,50,000
To share capital 1,50,000
- Redeem the pref shares
Premium on redemption of pref shares……..dr 20,000
Pref share capital………………………………………..dr 2,00,000
To pref share holder 2,20,000
Pref share holder……dr 2,20,000
To bank 2,20,000
- Transfer Rs. 50,000 to CRR
General reserve……….dr 50,000
To CRR 50,000
- Proceeds from issue of further shares 14500 shares @ Rs.10, premium @ 20%
Bank…………….dr 1,74,000
To share application 1,74,000
Share application……..dr 1,74,000
To share capital 1,45,000
To share premium 29,000
- Now share premium balance shall be used to w/o premium on redemption of pref.shares
Share premium………..dr 20,000
To premium on redemption of pref shares 20,000
- Issue the bonus shares using CRR
CRR………..dr 50,000
To equity share holder 50,000
Equity share holder……..dr 50,000
To share capital 50,000
Recent Threads
- Foreign Dividend earn
- TDS on Salary deducted but not paid by the employe
- GST INVOICE NOT SHOWN IN GSTR 1
- Turnover in AIS summary
- How to treat unutilised capital gain account schem
- What to do / how to handle about Capital receipt s
- How to show SGB interest in iTR
- How to file income tax return of ATM franchisee bu
- ITR Filing in case of deceased person
- Stuck with Schedule FSI in ITR 3
Related Threads
CAclubindia
