Pearl Ltd. issued a prospectus inviting applications for 40,000 shares of ₹ 10 each at a premium of 20%. The amount was payable as follows:

On Application – ₹ 5 per share

On Allotment – ₹ 5 per share (Including Premium) On First and Final call – Balance

Applications for 60,000 shares were received and allotment was made on a pro-rata basis to all the applicants. Excess money received on application was adjusted towards the amount due on allotment.

Sameer who had applied for 1,200 shares failed to pay the allotment money. His shares were forfeited immediately after allotment. All the forfeited shares were reissued at ₹ 7 per share as ₹ 8 paid up. First and final call was not yet made.

Pass necessary journal entries to record the above transactions in the book of Pearl Ltd. Open ‘Calls in Arrears Account’ wherever necessary.

Marks-6, CBSE: 2023-24/Compartment/Set-1/Q-25b*