(Oversubscription of Shares and Call-in-Arrears).
Alfa Co. Ltd. issued 50,000 Equity Shares of Rs. 10 each at a premium of Rs. 2 per share payable as follows:
Rs. 3 on application, Rs. 4 on allotment (including premium), Rs. 2 on first call and Rs. 3 on final call. Applications were received for 65,000 Equity Shares. Applications for 40,000 Equity Shares were accepted in full, 10,000 Equity shares were allotted to applicants of 20,000 Equity Shares and applications for 5,000 Equity Shares were rejected. The amounts due were duly received except the first call on 1,000 Equity Shares and final call on 1,500 Equity Shares.
Pass entries in the Cash Book and Journal of the Company. Also, show Share Capital in the Balance Sheet.

Explanation

Students are advised to prepare Ledger Accounts and observe how Share Capital Account appears:

Notes:
1. securlties Premium Reserve Account, being capital profit, will be shown on the Equity and Liabilities part of Balance Sheet under the head 'Reserves and Surplus'.
2. The amount not received on shares may or may not be transferred to Call-in-Arrears Account. But where the question prescribes so, amount not received is transferred to Call-in-Arrears Account.