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Forfeiture of Shares which are Issued at Par

The journal entry for forfeiture of shares issued at par is as follows:



If the allotment or call amount due have been transferred to the calls-in-arrears account, then the entry will be as follows:




Illustration 7

 

A Ltd. forfeited 200 equity shares of ₹ 10 each, fully called-up, held by Mr X, for non-payment of final call at ₹ 4 each. However, the application and allotment money of ₹ 2 and ₹ 4 per share, respectively, were paid by him. Give the journal entry for forfeiture.
 

Solution:

 

Journal Entries in the Books of A Ltd.
 



If the call amount due has been transferred to the calls-in-arrears account, then the entry will be as follows:

 





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