Applications
Question :
On 1st April, 2019, amita Ltd. issued 30,000 Equity Shares of Rs. 10 each at a premium of Rs. 4 per share, payable as follows:
Rs. 6 on application (including Rs. 1 premium),
Rs. 2 on allotment (including Rs. 1 premium),
Rs. 3 on first call (including Rs. 1 premium), and
Rs. 3 on second and final call (including Rs. 1 premium).
Applications were received for 45,000 shares, of which applications for 9,000 shares were rejected and their money was refunded. Rest of the applicants were issued shares on pro rata basis and their excess money was adjusted towards allotment.
Hari, to whom 600 shares were allotted, failed to pay the allotment money and his shares were forfeited after allotment. Mohan, who applied for 1,080 shares failed to pay the two calls and on his such failure, his shares were forfeited.
1,200 forfeited shares were reissued as fully paid-up on receipt of Rs. 9 per share, the whole of Mohan's shares being included.
Question:- Amount due but not paid by hari at the time of allotment will be:
Option 1: Rs. 720
Option 2: Rs. 1,200
Option 3: Rs. 480
Option 4: Nil
Correct Answer: Rs. 480
Solution :
Answer = Rs. 480
Excess amount received from Hari on application:
600 shares were allotted to Hari
Therefore, he must have applied for =36,000/ 30,000 x 600 = 720 shares
Excess application money received from Hari:
(720 shares - 600 shares) x Rs. 6 = 120 shares x Rs. 6 = Rs. 720.
Amount due but not paid by Hari on allotment:
Rs.
600 shares x Rs. 2
1,200
Less: Excess application money adjusted on allotment
[ Rs. 600 as a part of Share Capital (600 x Rs. 1) and balance Rs. 120 as a
720
part of Securities Premium]
Amount due but not paid by Hari
480
X Ltd. invited applications for 50,000 shares of Rs.10 each at 10% premium, payable on Rs.3 on application, Rs.3 on allotment and balance amount on first and final call Applications were received for 1,20,000 shares and shares were allotted on pro-rata basis The excess money received on application was to be adjusted against allotment only. A shareholder who applied for 6,000 shares, could not pay the call money and his shares were accordingly forfeited.
Question:- Money Received on application is _____.
Option 1: Rs. 1,50,000
Option 2: Rs. 1,20,000
Option 3: Rs. 3,60,000
Option 4: Rs. 2,10,000
Correct Answer: Rs. 3,60,000
Solution : Answer = Rs. 3,60,000
Application money received = Rs.1,20,000 X 3 = Rs.3,60,000.
Question : On 1st April, 2019, amita Ltd. issued 30,000 Equity Shares of Rs. 10 each at a premium of Rs. 4 per share, payable as follows:
Question:- Amount received on allotment will be:
Option 1: Rs. 60,000
Option 2: Rs. 24,000
Option 3: Rs. 23,520
Option 4: Rs. 36,000
Correct Answer: Rs. 23,520
Solution : Answer = Rs. 23,520
Amount received on allotment:
Total amount due on allotment (30,000 x Rs. 2)
60,000
Less: Excess application money adjusted (6,000 x Rs. 6)
36.000
24.000
Less: Amount due but not paid by Hari [WN 1 (b)]
Net amount received on allotment
23,520
Question : Y Ltd. invited applications for issuing 500, 12% debentures of Rs.100 each at a discount of 5%. These debentures were redeemable after three years at par. Applications for 600 debentures were received. Pro-rata allotment was made to all the applicants assuming that the whole amount was payable with application.
Question:- When excess application money is refunded, Bank Account will be credited by __________.
Option 1: Rs. 10,000
Option 2: Rs. 2,500
Option 3: Rs. 8,500
Option 4: Rs. 9,500
Correct Answer: Rs. 9,500
Solution : Answer = Rs. 9,500
Amount refunded (Rs. 100 X 95) = Rs. 9,500. Hence, the correct option is 4.
Question:- Discount on issue of debenture account will be _____.
Option 1: Debited by Rs. 3,000
Option 2: Debited by Rs. 2,500
Option 3: Credited by Rs. 2,500
Option 4: Credited by Rs. 3,000
Correct Answer: Debited by Rs. 2,500
Solution : Answer = Debited by Rs. 2,500
Debit discount on issue of Debentures with Rs.500 X 5= Rs. 2,500. Hence, the correct option is 2.
Question : X Ltd. invited applications for 50,000 shares of Rs.10 each at 10% premium, payable on Rs.3 on application, Rs.3 on allotment and balance amount on first and final call Applications were received for 1,20,000 shares and shares were allotted on pro-rata basis The excess money received on application was to be adjusted against allotment only. A shareholder who applied for 6,000 shares, could not pay the call money and his shares were accordingly forfeited.
Question:- Amount received at the time of First and Final call is _______.
Option 1: Rs. 2,37,500
Option 2: Rs. 2,50,000
Option 3: Rs. 2,22,000
Option 4: Rs. 2,38,000
Correct Answer: Rs. 2,37,500
Solution : Answer = Rs. 2,37,500
Number of shares after forfeiture = 50,000 - 2,500 (shares allotted). Call money = Rs.5. The amount received on call = Rs.47,500 X 5 = Rs.2,37,500.
To provide employment to the youth and to develop Baramula district of Jammu and Kashmir, Jyoti Power Ltd. decided to set up a power plant. For raising funds the company decided to issue 8,50,000 equity shares of Rs. 10 each at a premium of Rs. 3 per share. The whole amount was payable on application. Applications for 20,00,000 shares were received. Applications for 3,00,000 shares were rejected and shares were allotted to the remaining applicants on pro rata basis.
On the basis of the above information, choose the correct option to the following question.
Question:- Share capital will be credited by
Option 1: Rs. 85,00,000
Option 2: Rs. 26,00,000
Option 3: Rs. 14,95,000
Option 4: None of theses
Correct Answer: Rs. 85,00,000
Answer = Rs. 85,00,000
JOURNAL
Date
Particulars
L.F.
Dr. ( Rs.)
Cr.( Rs.)
Bank A/c
...Dr.
2,60,00,000
To Equity Shares Application and Allotment A/c (Application and allotment money received on 20,00,000 shares of Rs. 10 each @ Rs. 13 per share)
Equity Shares Application and Allotment A/c
To Equity Share Capital A/c (8,50,000 x Rs. 10)
To Securities Premium Reserve A/c (8,50,000 x Rs. 3)
To Bank A/c (11,50,000 x Rs. 13)
(Application and allotment money adjusted for 8,50,000 shares and the balance refunded)
85,00,000
25,50,000
1,49,50,000
Question:- Excess application money adjusted against the amount due on allotment is _____.
Option 1: Rs. 3,60,000
Option 3: Rs. 2,10,000
Option 4: None of these
Correct Answer: Rs. 2,10,000
Solution : Answer = Rs. 2,10,000
The excess amount is adjusted at the time of allotment = 70,000 (1,20,000 - 50,000) X Rs.3 = Rs.2,10,000.
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