BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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When Share Application Money is received, ____ account is credited
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Cash Account
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Share Application Account
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Share Capital Account
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None of the Above
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Explanation:
Detailed explanation-1: -On receipt of application money, share application account is credited.
Detailed explanation-2: -Share application account is referred to as a personal account. The share application account indicates the money received by shareholders in exchange for shares in the company. The share application account is debited when money is due and credited when paid.
Detailed explanation-3: -Share application money is ulimately transferred to share capital account.
Detailed explanation-4: -Share Application and Allotment A/c is debited while Share Capital A/c is credited for transfer of application money and allotment amount due.
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