When Accounting for the Issue of Shares, Placing Application Monies

question 65

Multiple Choice

When accounting for the issue of shares, placing application monies in a separate cash trust account is required:

• A) to meet the obligation by the company to remit the funds to ASIC.
• B) because the bank requires it.
• C) before the share issue is finalised as the money does not belong to the company and some or all of it may need to be refunded.
• D) it is administratively easier for the company if the money is placed in a separate account.

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Definitions:

Mercury

A heavy, silvery d-block element, also known as quicksilver, that is liquid at room temperature and used in thermometers, barometers, and batteries.

Elemental Symbol

A one- or two-letter abbreviation that represents a chemical element (e.g., H for hydrogen, O for oxygen).

Potassium

A soft, silvery-white metallic element, symbol K, with atomic number 19, essential for many biological functions and used in various industrial applications.

Elemental Symbol

A letter or combination of letters representing a chemical element in the periodic table.