Semaphore Plc Called for Subscriptions for 15 Million Shares B) $\text { Summary entry for September: }$

question 30

Multiple Choice

Semaphore Plc called for subscriptions for 15 million shares.The issue price per share is €2.50 to be paid in two parts: the first payment of €1.00 is to be made on application and the remaining €1.50 is to be paid within 1 month of allotment.At the end of September,when applications close,applications for 19 million shares have been received.The shares are allotted on 1 October on a pro rata basis with the excess application money to be applied against the amount due on allotment.All amounts on allotment are paid by the due date.What are the accounting entries to record these events?

• A) \(\begin{array}{l}
• \text { Summary entry for September: }\\
• \begin{array}{|c|l|r|r|}
• \hline \mathrm{Dr} & \text { Bank trust } & 19000000 & \\
• \hline \mathrm{Cr} & \text { Application } & & 19000000 \\
• \hline& & & \\
• \hline 1 \text { October: } & & \\
• \hline \mathrm{Dr} & \text { Application } & 15000000& \\
• \hline \mathrm{Cr} & \text { Share capital } & & 15000000\\
• \hline & & & \\
• \hline \mathrm{Dr} & \text { Allotment } & 22500000& \\
• \hline \mathrm{Cr} & \text { Share capital } & &22500000 \\
• \hline\\
• \hline\text { Dr } & \text { Application } & 4000000 & \\
• \hline \mathrm{Cr} & \text { Allotment } & & 4000000 \\
• \hline\\
• \hline \mathrm{Dr} & \text { Cash at bank } & 19000000 & \\
• \hline \mathrm{Cr} & \text { Bank trust } & & 19000000\\
• \hline\\
• \hline{\text { Summary entry for } 1 \text { November: }} & & \\
• \hline \mathrm{Dr} & \text { Cash at bank } & 18500000 & \\
• \hline \mathrm{Cr} & \text { Allotment } & & 18500000\\
• \hline
• \end{array}
• \end{array}\)
• B) \(\text { Summary entry for September: }\)
• \(\begin{array}{|l|l|r|r|}
• \hline \mathrm{Dr} & \text { Bank trust } & 19000000 & \\
• \hline \mathrm{Cr} & \text { Allotment } & & 19000000 \\
• \hline\\
• \hline {\text {1 October: }} & & \\
• \hline \mathrm{Dr} & \text { Allotment } & 15000000 & \\
• \hline \mathrm{Cr} & \text { Share capital } & & 15000000 \\
• \hline\\
• \hline \mathrm{Dr} & \text { Application } & 22500000 & \\
• \hline \mathrm{Cr} & \text { Share capital } & & 22500000 \\
• \hline & & & \\
• \hline \mathrm{Dr} & \text { Allotment } & 4000000 & \\
• \hline \mathrm{Cr} & \text { Application } & & 4000000 \\
• \hline\\
• \hline \mathrm{Dr} & \text { Cash at bank } & 19000000 & \\
• \hline \mathrm{Cr} & \text { Bank trust } & & 19000000 \\
• \hline{\text { Summary entry for 1 November: }} & & \\
• \hline \mathrm{Dr} & \text { Cash at bank } & 18500000 & \\
• \hline \mathrm{Cr} & \text { Application } & & 18500000 \\
• \hline
• \end{array}\)
• C) \(\text { Summary entry for September: }\)
• \(\begin{array}{|l|l|r|r|}
• \hline \mathrm{Dr} & \text { Bank trust } & 15000000 & \\
• \hline \mathrm{Cr} & \text { Application } & & 15000000 \\
• \hline\\
• \hline {\text {1 October: }} & & \\
• \hline \mathrm{Dr} & \text { Application } & 19000000 & \\
• \hline \mathrm{Cr} & \text { Share capital } & & 19000000 \\
• \hline\\
• \hline \mathrm{Dr} & \text { Alloment } & 22500000 & \\
• \hline \mathrm{Cr} & \text {Share capital} & & 22500000 \\
• \hline & & & \\
• \hline \mathrm{Dr} & \text { Allotment } & 4000000 & \\
• \hline \mathrm{Cr} & \text { Application } & & 4000000 \\
• \hline\\
• \hline \mathrm{Dr} & \text { Bank trust } & 19000000 & \\
• \hline \mathrm{Cr} & \text { Cash at bank } & & 19000000 \\
• \hline{\text { Summary entry for 1 November: }} & & \\
• \hline \mathrm{Dr} & \text {Bank trust } & 18500000 & \\
• \hline \mathrm{Cr} & \text { Allotment } & & 18500000 \\
• \hline
• \end{array}\)
• D) \(\text { Summary entry for September: }\)
• \(\begin{array}{|l|l|r|r|}
• \hline \mathrm{Dr} & \text { Bank trust } & 22500000 & \\
• \hline \mathrm{Cr} & \text { Alloment } & &22500000 \\
• \hline\\
• \hline {\text {1 October: }} & & \\
• \hline \mathrm{Dr} & \text { Alloment } & 22500000 & \\
• \hline \mathrm{Cr} & \text { Share capital } & & 22500000 \\
• \hline\\
• \hline \mathrm{Dr} & \text { Application } & 19000000 & \\
• \hline \mathrm{Cr} & \text { Share capital} & &19000000 \\
• \hline & & & \\
• \hline \mathrm{Dr} & \text { Application } & 4000000 & \\
• \hline \mathrm{Cr} & \text { Alloment} & & 4000000 \\
• \hline\\
• \hline \mathrm{Dr} & \text { Cash at bank} & 18500000 & \\
• \hline \mathrm{Cr} & \text { Bank trust} & & 19000000 \\
• \hline{\text { Summary entry for 1 November: }} & & \\
• \hline \mathrm{Dr} & \text {Bank trust } & 18500000 & \\
• \hline \mathrm{Cr} & \text { Application} & & 18500000 \\
• \hline
• \end{array}\)

Recognize the effects of unforeseen events on contract obligations and discharges.

Distinguish between express, implied-in-fact, and implied-in-law contractual conditions.

Describe how contracts can be discharged by mutual agreement and operation of law.

Explain the doctrine of frustration of purpose and its applicability in contract law.

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Definitions:

Atlatl

The atlatl is an ancient weapon used for throwing spears or darts, consisting of a shaft with a cup or spur at the end that propelled the spear with greater force.

Burin

A burin is a tool used for engraving or incising hard materials such as stone or metal, typically used in printmaking, jewelry design, and archaeology.

Denisovans

An extinct species or subspecies of archaic humans in the genus Homo, known from DNA evidence and a few fossils found in Siberia.

Mousterian Toolmakers

Prehistoric peoples associated with the Middle Paleolithic period, known for their stone tool technology used by Neanderthals and early modern humans.