On 1 May 2020, Chosen One Ltd issued a prospectus, inviting applications for ordinary shares. One...
On 1 May 2020, Chosen One Ltd issued a prospectus, inviting applications for ordinary shares. One million were being offered, at a cost of $3 each, payable in full on application. The issue was not underwritten. By the closing date of 23 May 2020, applications for 1,500,000 shares had been received. On 10 June 2020, successful applicants received their shares and unsuccessful applicants received a full refund. Which of the following is NOT a journal entry that would be used to record the above transactions?
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Dr Cash $4,500,000 Cr Application $4,500,000 |
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Dr Application $3,000,000 |
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Dr Cash $3,000,000 Cr Cash trust $3,000,000 |
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Dr Application $1,500,000 |
Homework Answers
Ans:-
Dr Cash $3,000,000 Cr Cash trust $3,000,000
is Not a journal entry that would be used to record the above transaction Because
The above entry is passed by the full Share appilication amount that is $4,500,000. not of $3,000,000.
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