Reference no: EM132559636

Question -

(a) Purvanshi Ltd. invited applications for 80,000 equity shares of Rs. 10 each at a premium of Rs. 35 per share. The amount was payable as follows:

Application: Rs. 15 per share (Including Rs. 12 premium)

Allotment: Rs. 10 per share (Including Rs. 8 per share)

First and final call: Balance.

Applications for 75000 shares were received and allotment was made to all the applicants. A shareholder Karan, who was allotted 3000 shares failed to pay the allotment money and his shares were immediately forfeited. Later, the first and final call was made and Mehak, who had 4000 shares failed to pay the first and final call and her shares were subsequently forfeited. Out of the forfeited shares, 5000 shares were re-issued at Rs. 50 per share fully paid up. The re-issued shares included all the shares of Karan. Pass the necessary journal entries and show proper working notes wherever required.

(b) Rickel Ltd. issued 6%, 9000 debentures of Rs. 1000 each at 5% discount on 1st April, 2018 redeemable at a premium of 8% after 10 years. As per the terms of the prospectus, Rs. 400 was to be paid on application and balance on allotment of debentures. Record necessary journal entries along with working notes.