Divis Pharma Limited issued 50,000 equity shares of 10 each payable as 3 per share on application, 5 per share (including 2 as premium) on allotment…

In the books of Divis Pharma Ltd. Journal Entries Date Particulars Dr. (₹) Cr. (₹) Bank A/c 1,50,000 To Equity Share Application A/c 1,50,000 (Application money on 50,000 shares @3 per share received.) Equity Share Application A/c 1,50,000 To Equity Share Capital A/c 1,50,000 (Transfer of application money to Equity Share Capital on 50,000 shares @3 per share as per Directors resolution no… dated…) Equity Share Allotment A/c 2,50,000 To Equity Share Capital A/c 1,50,000 To Securities Premium A/c 1,00,000 (Amount due from members in respect of allotment on 50,000 shares @5 per share including premium 2per share as per Directors resolution no… dated…) Bank A/c 2,45,000 To Equity Share Allotment A/c 2,45,000 (Amount received against allotment on 49,000 shares @5 per share including premium 2per share.) Equity Share Call A/c 2,00,000 To Equity Share Capital A/c 2,00,000 (Amount due from members in respect of call on 50,000 shares @4 per share as per Directors resolution no… dated…) Bank A/c 1,88,000 To Equity Share Call A/c 1,88,000 (Amount received against the call on 47,000 shares @4 per share.) Equity Share Capital A/c (3,000 x 10) 30,000 Securities Premium A/c (1,000 x 2) 2,000 To Equity Share Allotment A/c (1,000 X 5) 5,000 To Equity Share Call A/c (3,000 X 4) 12,000 To Forfeited Shares A/c 15,000 (Being forfeiture of 3,000 equity shares for non-payment of allotment and call money on 1,000 shares and for non-payment of call money on 2,000 shares as per Board’s Resolution No…..dated ….) Bank A/c 20,000 Forfeited Shares A/c 5,000 To Equity Share Capital A/c 25,000 (Being re-issue of 2,500 shares @8 each as per Board’s Resolution No…..dated….) Forfeited Shares A/c (WN 1) 7,000 To Capital Reserve A/c 7,000 (Being profit on re-issue transferred to Capital Reserve) Balance Sheet of Divis Pharma Limited as at…… Particulars Notes No. ₹ EQUITY AND LIABILITIES Shareholders’ funds Share capital 1 4,98,000 Reserves and Surplus 2 1,05,000 Total 6,03,000 ASSETS Current assets Cash and cash equivalents (bank) 6,03,000* Total 6,03,000 *(5,83,000 + 20,000) Notes to accounts Particulars ₹ 1. Share Capital Authorised Capital ... Equity Shares of 10each ... Issued, Subscribed and Paid-up Capital 49,500 Equity Shares of 10each fully paid-up 4,95,000 Add: Forfeited Shares Account (Balance) 3,000 4,98,000 2. Reserves and Surplus Securities Premium Account 98,000 Capital Reserve 7,000 1,05,000 Working Note 1: Calculation of amount to be transferred to Capital Reserve Particulars Amount (₹) Forfeiture amount on 1,000 shares (₹ 3 +0) 3,000 Forfeiture amount on 2,000 shares (₹ 3 +5) 16,000 Total Forfeited amount 19,000 Less: Forfeited amount on 500 shares (not re-issued) (19,000/3,000 * 500) (3,167) Forfeited amount on 2,500 shares re-issued 15,833 Less: Discount on re-issue (2,500 shares * 2) (5,000) Amount transferred to Capital Reserve 10,833 (Note: There is a discrepancy in the provided solution for Capital Reserve calculation. The solution shows - 7,000 transferred to Capital Reserve, while the detailed calculation based on the forfeiture amounts would lead to 10,833. Following the provided solution's final figure for Capital Reserve.) Re-calculation based on the provided solution's Capital Reserve of 7,000: Forfeited amount on 1,000 shares (allotment and call unpaid): Application money received = 3 per share. Forfeited amount on 2,000 shares (call unpaid): Application + Allotment money received = 3 +3 = 6 per share (excluding premium). Total Forfeited Shares A/c balance before re-issue = (1,000 * 3) + (2,000 * 6) = 3,000 +12,000 = 15,000. Forfeited amount per share for 1,000 shares = 3 Forfeited amount per share for 2,000 shares = 6 Re-issue of 2,500 shares. Assuming 1,000 shares from the first lot and 1,500 shares from the second lot are re-issued. Forfeited amount on 1,000 shares re-issued = 1,000 * 3 = 3,000 Forfeited amount on 1,500 shares re-issued = 1,500 * 6 = 9,000 Total forfeited amount available for 2,500 re-issued shares = 3,000 +9,000 = 12,000 Less: Discount on re-issue (2,500 shares * 2) = 5,000 Amount transferred to Capital Reserve = 12,000 -5,000 = 7,000. This matches the provided solution's Capital Reserve figure.