Peterson Company is issuing 4 000 ordinary shares, payable by instalments. Investors must pay $10 per share on application, $5 per share on allotment, and there will be a final call of $2 payable at a later date to be determined by directors. The journal entry to record the final call by directors will include:
A)a credit to Cash.
B)a debit to Application.
C)a debit to Trust bank account.
D)a credit to Ordinary share capital.

Question

Quizplus · Accepted Answer

The final call will increase the Ordinary share capital, so it will be credited.

Peterson Company Is Issuing 4 000 Ordinary Shares, Payable by Instalments