Question

    Consider the following journal entry:

    src="https://www.ixambee.com/questionimage/Chapter/1690539208-38.JPG" alt="" /> In what circumstances, such journal entry is passed?
    A Forfeiture of shares which were issued at premium Correct Answer Incorrect Answer
    B Forfeiture of shares which were issued at par Correct Answer Incorrect Answer
    C Forfeiture of shares which were issued at discount Correct Answer Incorrect Answer
    D Reissue of forfeited shares Correct Answer Incorrect Answer

    Solution

    Amount of discount which was earlier booked as expense is now reversed: Share Capital A/c Dr (amount called up) To share allotment A/c (allotment unpaid) To share call A/c (call unpaid) To forfeited shares A/c (total amount paid) To discount on issue of shares A/C (amount of discount)

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