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Numerical Example of Assets Realisation

Why share app...

Question

Why share application amount is transferred to share capital account on the date of allotment

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Solution

Dear Student,

The application money when received is not confirmed that the shares will be allotted or partly allotted or rejected to the applicants. On the date of allotment, the no of shares are allotted to the applicants confirming their share in the company. Thus, after confirmation of allottees ,the application money is transferred to share capital account.

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