Question

Sun Ltd., issued shares of Rs. 50 each at a premium of 20% payable as follows :
`{:("On Application","Rs. 15"),("On Allotment","Rs. 25 (including premium)"),("On First & Final Call","Rs. 20"):}`
Dev, who applied for 2,500 shares and to whom 1,000 shares were allotted on prorata basis, did not pay allotment and first & final call and his shares were forfeited. Pass entry for forfeiture of shares.

Answer 1

Amount credited to Share Forfeiture Account Rs. 30,000.
Hint : Security Premium Reserve A/c will be debited by Rs. 2,500 in the entry for forfeiture of shares.