In a Journal Entry of Forfeiture of Shares, Securities Premium Account may be debited, when :-
Answer & explanation
Correct answer: option 1
The correct answer is option 1- Share are issued at premium and calls in arrears include premium.
In a Journal Entry of Forfeiture of Shares, Securities Premium Account may be debited, when Share are issued at premium and calls in arrears include premium.
Forfeiture of Shares issued at Premium:
Share Capital A/c..........(Called up amount) Dr.
Securities premium A/c........(Premium amount) Dr.
To Share Forfeiture A/c...........(Paid up amount)
To Share Allotment A/c............(Amount not received)
To Calls in arrears A/c.............. (Amount not received)
(Shares forfeited for non-payment of allotment money and calls made)