- This topic has 5 replies, 2 voices, and was last updated 9 years ago by
.
- Posts
share 560,000, share premium 285000
bonus shares on the basis of 1 for 4 already held by capitalising part of general reserve
later new issue share at full market price
at the end share 960,000, share premium 400,000
what price were the new share and how much share premium was received on each new share
answer 39.375 cents issued price, 14.375cents premium
I can not get the answer, could you please be so kind to show me ?
the bonus share from general reserve, so after the bonus issue the share premium still is 285000?,
If the bonus issue is financed by capitalising the general reserve, then there’s no movement on the share premium account, correct
After the bonus issue, there is $700,000 nominal value of shares in issue
The closing value is $960,000 and there is a movement on share premium of $115,000
So $260,000 worth of shares have been issued at a premium of $115,000
BUT …….. even though you haven’t told me what the nominal value of a share is (and you should have done!) I can see that the nominal value per share is 25 cents
That means that the NUMBER of new shares issued at full market price is 1,040,000 and the value received was (260 + 115) $375,000 and therefore a premium of 14.375 cents per 25 cent share
OK?
hi mike, but 375/ 1040=0.36 cent per share? the premium should be 0.11?
so that is why I am confused
Ok, whose mock exam is this – and please don’t say it’s one of ours!
This looks suspiciously like a misprint in the closing share capital figure
By working backwards, it’s my belief that the closing share capital value should be $900,000 and not $960,000 as per your post
Check that out and see if you can agree …..
….. and let me know please if it’s one of our questions
- You must be logged in to reply to this topic.