A Ltd. Co. with a subscribed capital of Rs. 5,00,000 in equity shares of Rs.
10 each has called up Rs. 7 per share and duly paid up. The company has
resolved that a bonus of Rs. 1, 50,000 will be declared out of the reserve and
surplus in the form of payment of final call. Along with this the company has
further decided to utilize the reserves and surplus to issue fully paid up bonus
shares in the ratio of one equity share for every five equity shares held. Following
are the balances under reserves and surplus :
Share premium Rs. 2,00,000 and General Reserve Rs. 1,80,000.
Show the necessary journal entries in the books of the company.
