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Home Questions JYXRWSK633
Target Exam

CUET

Subject

Accountancy

Chapter

Accounting for Shares

Question:

Match the following at the time of forfeiture of shares.

LIST 1 LIST 2
1) Share capital is debited with a) Amount called
2) Share forfeiture is credited with b) Amount not received
3) Calls in arrears is credited with c) Amount received

 

Options:

1) a, 2) b, 3) c

1) b, 2) c, 3) a

1) a, 2) c, 3) b

1) c, 2) a, 3) b

Correct Answer:

1) a, 2) c, 3) b

Explanation:
LIST 1 LIST 2
1) Share capital is debited with a) Amount called
2) Share forfeiture is credited with c) Amount received 
3) Calls in arrears is credited with b) Amount not received

 

 

Forfeiture of Shares issued at Par:
Share Capital A/c..........(Called up 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)

The above journal entry is passed for the forfeiture of shares. From this we can see that which account is debited or credited for which amount.

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