04 January 2010
Hi Ravi, you have not mentioned with which amount the securities premium has been received. A co. can collect securities premium along with application / allotment or call money. Share capital is always credited with the face value of the share. Any amount received over and above the same is credited toa separate account called securities premium account. the max. possible entry/ies will be : Share application/allotment/call A/c Dr. To securities premium A/c (By whatever amount of premium is received) for your knowledge i m giving all possible entries : 1) Cash / Bank A/c Dr.(amt. recd) To share application A/c 2) Share application A/c Dr. To Share capital A/c (called up capital) To Securities premium A/c(premium Recd) To share allotment A/c (application money adjusted towards allotment money due) To Calls in advance A/c (excess application money kept with the co) To Bank A/c (excess application money refunded back) 3) Share allotment A/c Dr. (gross amount due) Discount on issue of shares A/c Dr. (discount amt) To Share Capital A/c (called up capital) To securities premium A/c (premium money due) 4) Bank A/c dr. (Amt recd.) Calls in arrears A/c Dr. (amt. not recd) Calls in advance A/c Dr.(amt. already recd) To Share allotment A/c (A/c closed) 5) Share call A/c Dr. To Share capital A/c To Securities premium A/c 6) Bank A/c dr. Calls in arrears A/c Dr. Calls in advance A/c Dr. To Share call A/c these are the basic 6 entries. keep in mind that both discount on issue of shares and securities premium can not appear in the entry. only one element will be there. if u need further clarification, revert back to me. Regards, CA Shakuntala Chhangani
CAclubindia
