Gupta Ltd. issued 1,000 equity shares of each as fully paid-up, to the vendor, in consideration of the purchase of plant and machinery worth . Which of the following entry will be recorded in the company's journal for it?
- A
- B
- C
- D
Solution & Step-by-step Explanation
When shares are issued to a vendor for settling purchase consideration:First, on purchase of asset:
Next, on allotment of shares to the vendor:
Hence, the correct journal entry matching the options for the share issuance phase is option D.
Next, on allotment of shares to the vendor:
Hence, the correct journal entry matching the options for the share issuance phase is option D.