MyQuestionIcon

1

You visited us 1 times! Enjoying our articles? Unlock Full Access!

Pro-Rata Basis of Allotment

The journal e...

Question

The journal entry for the refund of application money is-

A

Share Allotment A/c Dr.

To Bank A/c

No worries! We‘ve got your back. Try BYJU‘S free classes today!

B

Bank A/c Dr.

To Share Allotment A/c

No worries! We‘ve got your back. Try BYJU‘S free classes today!

C

Share Application A/c Dr.

To Bank A/c

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

D

Bank A/c Dr.

To Share Application A/c

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Open in App

Solution

The correct option is C
Share Application A/c Dr.

To Bank A/c

The journal entry for the refund of application money is-

Share Application A/c Dr.

To Bank A/c

Suggest Corrections

thumbs-up

9

Similar questions

Q. If a company receives excess application money and the application money equal to shares issued transferred to Share Capital A/c and application money received on excess shares-some money is adjusted and against allotment and remaining was refunded, then which of the following entry is correct?

Q. ABC Company Ltd.offered for subscription 20,000 shares of ₹ 10 each payable ₹ 3 on application and ₹ 5 on allotment for each share. Applications were received fro 30,000 shares . Letters of regret were issued to applicants for 5,000 shares and their application money was refunded . Application money for other 5,000 shares was applied towards the payment for allotment money . The balance of allotment money was also received in due time .
You are to prepare the journal , Cash Book , Ledger Accounts and the Balance Sheet of the company.

Q. Assertion :When pro-rata allotment of shares is made, the surplus application money is transferred to Share Allotment A/c. Reason: The company is not required to pay any interest on each surplus application money.

Q. In allotment of shares, for transfer of application money, __________ A/c is debited and _________ A/c is credited.

Q. A company invited applications for certain number of equity shares and received applications for more number of shares along with the applications money. Which of the following alternative can be followed?
I. Refund the excess applications.
II. Make pro-rata allotment to all the applicants, and no refund of excess application money.
III. Not to allot any shares to some applicants, full allotment to some of the applications and pro-rata allotment to the rest of the applicants.
IV. Not to allot any shares to some applicants and make pro-rata allotment to other applicants.

View More

Join BYJU'S Learning Program

similar_icon

Related Videos

lock

Mismatch in Demand and Supply

ACCOUNTANCY

Watch in App

explore_more_icon

Explore more

Pro-Rata Basis of Allotment

Standard XII Accountancy

Join BYJU'S Learning Program

CrossIcon