ACE Glue Stick LLC called an application for equity shares of 200,000 which are amounting to OMR 50 per share. They were payable as follows :

Application

OMR 6

Allotment

OMR 19

First call

OMR 19

Second call and final call

OMR 6

On March 01, 2017 the company received applications for 1,000,000 shares and the allotment on shares were made on April 01, 2017.

You are required to analyse the given situations and provide necessary journal entries for scenario 1 and 2.

a) Scenario 1: The board of directors made some important decisions regarding the allotment of shares to the applicants. They allotted 200,000 shares to some selected applicants in full. But they rejected the applications on the remaining number of shares.(5 marks )

b) Scenario 2: The board of directors decided that no any applicant should be made upset with regard to the application of shares, so that they allotted to all the applicants 15% of their applied number of shares. The balance amount is due on allotment and the amount remaining thereafter is refunded. (5 marks )