Accountancy Part AAccounting for Shares

Rearrange the following steps in a logical sequence to be followed du…

Rearrange the following steps in a logical sequence to be followed during issue of Share Capital.

(A) Making allotment due
(B) Making first and final call due
(C) Receiving Share Application money
(D) Receiving Allotment money
(E) Transferring Share Application to Share Capital

Choose the correct answer from the options given below:

Answer & explanation

Correct answer: option 3

The correct answer is Option (3) → (C), (E), (A), (D), (B)

(C) Receiving Share Application money – money comes in with the applications (Bank A/c Dr, To Share Application A/c).

(E) Transferring Share Application to Share Capital – on allotment, application money becomes share capital.

(A) Making allotment due – Share Allotment A/c Dr, To Share Capital A/c.

(D) Receiving Allotment money – Bank A/c Dr, To Share Allotment A/c.

(B) Making first and final call due – calls are made after allotment to collect the balance.

NCERT (2026-27 edition):
Accounting Treatment

Extract from the NCERT textbook

NCERT (2026-27 edition):
On Calls – “Calls play a vital role in making shares fully paid-up and for realising the full amount of shares from the shareholders. In the event of shares not being fully called up till the completion of allotment, the directors have the authority to ask for the remaining amount on shares as and when they decide about the same.”