Q.Shine Apparels Ltd forfeited 200 equity shares of ₹10 each, issued at a premium of ₹2 per share, for non-payment of the final call of ₹4 per share. The premium of ₹2 per share had already been received in full along with the allotment money. Pass the journal entry for forfeiture.

Because the ₹2 premium per share was already collected before this default, Securities Premium is left untouched; only the face value called-up (₹10 per share) is cancelled from Share Capital, the unpaid final call (₹4 per share) is written off, and the balance already received (₹6 per share) goes to Share Forfeiture. …

Amounts involved (face value ₹10; premium ₹2 already received with allotment; unpaid = final call of ₹4)

• Called-up face value being cancelled = 200 × ₹10 = ₹2,000
• Unpaid final call = 200 × ₹4 = ₹800
• Already received (application + allotment, face value only, excluding premium) = 200 × (₹10 − ₹4) = 200 × ₹6 = ₹1,200 — credited to Share Forfeiture

Since the premium was collected in full before the default, it is a genuinely earned reserve and must not be reversed.

Journal entry