Greenrock Limited is a company with an authorized share capital of 4,00,00,000 in equity shares of 10 each, of which - 30,00,000 shares had been…

CA Foundation · Accounting · RTP · January 2026
Greenrock Limited is a company with an authorized share capital of 4,00,00,000 in equity shares of 10 each, of which - 30,00,000 shares had been issued and fully paid on 30th June, 2024. The company proposed to make a further issue of 2,60,000 shares of 10 each at a price of 12 each, the arrangements for payment being: (i) 2 per share payable on application, to be received by 1st July, 2024; (ii) Allotment to be made on 10th July, 2024 and a further 5 per share (including the premium) to be payable; (iii) The final call for the balance to be made, and the money received by 31th March, 2025. Applications were received for 8,40,000 shares and were dealt with as follows: (1) Applicants for 40,000 shares received allotment in full; (2) Applicants for 2,00,000 shares received an allotment of one share for every two applied for; no money was returned to these applicants, the surplus on application being used to reduce the amount due on allotment; (3) Applicants for 6,00,000 shares received an allotment of one share for every five shares applied for; the money due on allotment was retained by the company, the excess being returned to the applicants; and (4) The money due on final call was received on the due date. You are required to record these transactions (including cash items) in the journal of Greenrock limited.

Suggested Answer and Working Notes:

Journal of Greenrock Limited Date Particulars Dr. ₹ Cr. ₹ 2024 July, 1 Bank A/c (Note 1 – Column - 3) Dr. 16,80,000 To Equity Share Application A/c 16,80,000 (Being application money received on 8,40,000 shares @2 per share) July, 10 Equity Share Application A/c Dr. 16,80,000 To Equity Share Capital A/c 5,20,000 To Equity Share Allotment A/c (Note 1- Column - 5) 8,00,000 To Bank A/c (Note 1– Column - 6) 3,60,000 (Being application money on 2,60,000 shares transferred to Equity Share Capital Account; on 4,00,000 shares adjusted with allotment and on 1,80,000 shares refunded as per Board’s Resolution No…..dated…) Equity Share Allotment A/c Dr. 13,00,000 To Equity Share Capital A/c 7,80,000 To Securities Premium a/c 5,20,000 (Being allotment money due on 2,60,000 shares @5 each including premium at 2 each as per Board’s Resolution No….dated….) Bank A/c (Note 1 – Column - 8) Dr. 5,00,000 To Equity Share Allotment A/c 5,00,000 (Being balance allotment money received) Equity Share Final Call A/c Dr. 13,00,000 To Equity Share Capital A/c 13,00,000 (Being final call money due on 2,60,000 shares @5 per share as per Board’s Resolution No….dated….) March, 31st Bank A/c Dr. 13,00,000 To Equity Share Final Call A/c 13,00,000 (Being final call money on 2,60,000 shares @5 each received) Working Note: Calculation for Adjustment and Refund Category No. of Shares Applied for No. of Shares Allotted Amount Received on Application (1x 2) Amount Required on Application (2x 2) Amount adjusted on Allotment Refund [3-4-5] Amount due on Allotment Amount received on Allotment (1) (2) (3) (4) (5) (6) (7) (8) (i) 40,000 40,000 80,000 80,000 Nil Nil 2,00,000 2,00,000 (ii) 2,00,000 1,00,000 4,00,000 2,00,000 2,00,000 Nil 5,00,000 3,00,000 (iii) 6,00,000 1,20,000 12,00,000 2,40,000 6,00,000 3,60,000 6,00,000 Nil TOTAL 8,40,000 2,60,000 16,80,000 5,20,000 8,00,000 3,60,000 13,00,000 5,00,000

Topics: Issue, Forfeiture and Re-issue of Shares

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