Minstrel Ltd Decided to Issue 200 000 Ordinary Shares for $2.50

Minstrel Ltd decided to issue 200 000 ordinary shares for $2.50 each, payable in instalments, $1 on application, $1 on allotment and the balance payable at the discretion of the company. Applications were received for 220 000 shares. The shares were allotted by the directors at a meeting held a week after the close of applications. After refunding applications for 20 000 shares, which of the following is the correct journal entry to transfer the application money to the share capital account?

A) DR Application $220 000; CR Cash trust account $220 000
B) DR Cash trust account $200 000; CR Share capital account $200 000
C) DR Application $220 000; CR Share capital $220 000
D) DR Application $200 000; CR Share capital $200 000