When the application for some shares are rejected outrightly and pro-rata allotment is made to the remaining applicants, the money on rejected applications are ______.

None of the above

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Adjusted in allottment

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Kept in a separate bank account

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Refunded

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Solution

The correct option is D
Refunded

When the application for some shares are rejected outrightly and pro-rata allotment is made to the remaining applicants, the money on rejected applications are refunded.

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Similar questions

Q. A company invited applications for 25,000 equity shares of Rs 10 each and received 30,000 applications along with the application money of Rs 4 per share. Which of the following alternatives can be followed?
I. Refund the excess applications.
II. Make pro rata allotment to all the applicants, and refund the excess application money.
III. Not to allot any shares to some applicants, full allotment to some of the applicants and pro rata allotment to the rest of the applicants.
IV. Not to allot any shares to some applicants and make pro rate allotment to other applicants.
V. Make pro rata allotment to all the applicants and adjust the excess money received towards call money.

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.

Q. A company offered 30,000 shares of ₹10 each, payable as ₹3 on application, ₹2 on allotment, and the balance on the first and final call. Applications were received for 50,000 and allotment was made on a pro rata basis. The excess application money was to be adjusted on allotment. How much will be transferred from a share application account to a share allotment account?

[0.88 marks]

A company issued 4,000 equity shares of Rs. 10 each at par payable as under :

On application Rs. 3; On allotment Rs. 2; On first call Rs. 4 and on final call Rs. 1 per share

Applications were received for 13,000 shares. Applications for 3,000 shares were rejected and pro-rata allotment was made to the applicants for 10,000 shares. How much amount will be received in cash on the first call? Excess application money is adjusted towards the amount due on allotment and calls.

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.

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When the application for some shares are rejected outrightly and pro-rata allotment is made to the remaining applicants, the money on rejected applications are ______.

The correct option is D Refunded When the application for some shares are rejected outrightly and pro-rata allotment is made to the remaining applicants, the money on rejected applications are refunded.

The correct option is D
Refunded

When the application for some shares are rejected outrightly and pro-rata allotment is made to the remaining applicants, the money on rejected applications are refunded.