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Homework answers / question archive / Adelaide Briton Ltd was registered on the first of July 2020

Adelaide Briton Ltd was registered on the first of July 2020

Accounting

Adelaide Briton Ltd was registered on the first of July 2020. The company's directors issue a disclosure document inviting applicants for 2 000 000 ordinary shares for an issue price of $1. The share is payable 60c on application and 20c on allotment. Adelaide Briton Ltd reserves the right to allot to individual applicants on a pro rata base, a lesser number of shares than the number applied for, and may apply excess application monies to the allotment and to calls in advance. The company's director must allot exactly 2 000 000 shares.

 

First Scenario: Applications for 2 200 000 shares are received with the correct application money.

Second Scenario: Applications for 2 750 000 shares are received with the correct application money.

 

 

Required:

For each of the above scenarios:

 

  1. Calculate the amount of application money that would be applied to application and calls (including allotment).
  2. Prepare journal entries.

Option 1

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