Given below are the extracts of Balance Sheet of Shell Chemicals Limited as on 31st March, 2024: Particulars Amount in ₹ 9% Redeemable Preference…

In the books of Shell chemicals Ltd. Journal Entries Particulars Dr. ₹ Cr. ₹ 9% Preference Share Capital A/c Dr. 1,00,000 To Calls in Arrears A/c 20,000 To Shares Forfeited A/c 80,000 (For Shares Forfeited because of non-payment of calls as holders are unknown) Bank A/c (W N) Dr. 2,00,000 To Equity Share Capital A/c 2,00,000 (Being the issue of20,000 Equity Shares of 10each at par as per Board’s Resolution No…..dated….) General Reserve A/c Dr. 7,00,000 To Capital Redemption Reserve A/c 7,00,000 (For transfer to CRR for the amount not covered by the proceeds of fresh issue of equity shares) 9% Preference Share Capital A/c Dr. 9,00,000 To Preference Shareholders A/c 9,00,000 (For amount payable to preference shareholders) Preference Shareholders A/c Dr. 9,00,000 To Bank A/c 9,00,000 (For amount paid to preference shareholders) Working Note: Number of Shares to be issued for redemption of Preference Shares: Face value of shares redeemed = 9,00,000 Less: Profit available for distribution as dividend: General Reserve = 7,00,000 = 2,00,000 Therefore, number of shares to be issued = 2,00,000 /10 = 20,000 shares.