Reference no: EM131804785

Wolfgang issue shares via installment.

On 1st June they issue a prospectus to potential investors advertising that they will sell $1,000,000 shares at $1 each. Payable $0.50 on application, $0.30 on allotment, and $0.20 on call.

By 15th September, the applications are all received, and 1,500,000 share applications were received. On 30th September, Wolfgang decide to refund excess applications.

What journal entry should be entered on 30th September?

Dr Application $250,000

Cr Allotment $250,000

Dr Cash $1,500,000

Cr Cash Trust $1,500,000

Dr Application $250,000

Cr Cash Trust $250,000

Dr Application $1,500,000

Cr Ordinary Share Capital $1,500,000