Share capital sh.1000000 ordinary shares of sh. 10 each

on application sh. 1.00 on allotment sh. 3.00

on first call sh.4.00 on second call sh. 2.00

Applications were received for 1630000 shares

money refunded to applicants on 130000 shares and to allot all the remaining shares on pro-rata basis

excess applications money received from successful applicants is to be refunded but to be applied to reduce the amount payable on allotment.

calls made and paid in full with the exception of one member holding 5000 shares who paid neither the first nor the second call. after requisite action by directors the shares were forfeited. they were later issued at a price of sh. 8 per share.

required :

1. Journal entries to record these transactions
2. the necessary ledger accounts to record these transactions