Sundowner Ltd Called for Subscriptions for 2 Million Shares

question 9

Multiple Choice

Sundowner Ltd called for subscriptions for 2 million shares.The issue price per share is $6.00 to be paid in three parts: the first payment of $3.00 is to be made on application,$2.00 is to be paid within 1 month of allotment and the remaining $1.00 is to be paid within 6 months of allotment.At the end of July,when applications close,applications for 5 million shares have been received.Two million share applicants were unsuccessful,while the remaining 3 million applicants were allotted shares on 1 August on a pro rata basis with the excess application money to be applied against the amount due on allotment.The first and final call on the shares is made on 1October.Assume all amounts on allotment and call are paid by the due date.What are the accounting entries to record these events?

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Definitions:

Growing Season

The period of the year during which climatic conditions are suitable for plants to grow.

Topsoil Horizon

The uppermost layer of soil, which contains organic material, minerals, and is crucial for plant growth.

Permafrost

Permanently frozen ground, usually occurring in the tundra, a biome of Arctic regions.

Little Rainfall

A climatic condition characterized by low precipitation over a period of time, which can influence ecosystems, agriculture, and water resources.