For Calls in Arrears?

Calls-in-Arrears. If some amount, called in respect of a share, is not paid before or on the specific date fixed for payment, such amount which is not paid, is called “Calls-in-arrears”. Such amount may be called up by the Company either as Allotment Money or Call Money.

What is the meaning of the calls in arrears?

Call in Arrear

The company calls for money from shareholders when needed within a certain period. If the shareholder is not able to pay the call amount due on an allotment or on any calls according to the terms before or on the specific date fixed for payment, such amount is taken as 'call in arrears'.

What is the journal entry for calls in arrears?

Under this method, we credit the receipt from shareholders to the relevant call account and various call accounts will show debit balance equal to the total unpaid amount of calls. On a subsequent date, when we receive the amount of Calls-in-Arrears, we debit Bank Account and credit the relevant Call Account.