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Question
For transfer of application money and allotment due, __________ A/c is debited and _________ A/c is credited.
For transfer of application money and allotment due, __________ A/c is debited and _________ A/c is credited.
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Solution
The correct option is A Share Application and Allotment, Share Capital
Sometimes a combined account for share application and share allotment called 'Share Application and Allotment Account' is opened in the books of a company. The combined account is based on the reasoning that allotment without application is impossible while application without allotment is meaningless. These two stages of share capital are closely inter-related. Share Application and Allotment A/c is debited while Share Capital A/c is credited for transfer of application money and allotment amount due.
Sometimes a combined account for share application and share allotment called 'Share Application and Allotment Account' is opened in the books of a company. The combined account is based on the reasoning that allotment without application is impossible while application without allotment is meaningless. These two stages of share capital are closely inter-related. Share Application and Allotment A/c is debited while Share Capital A/c is credited for transfer of application money and allotment amount due.
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