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ARNISON CO (PRE June Mock 2023)

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › ARNISON CO (PRE June Mock 2023)

  • This topic has 1 reply, 2 voices, and was last updated 1 week ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • May 26, 2023 at 2:50 pm #685117
    simranxdeep
    Participant
    • Topics: 32
    • Replies: 51
    • ☆☆

    Hi Sir, while checking for the answer of the question, I saw that the examiner’s approach and my approach are poles apart, however, my answer is correct.
    What the examiner does is probably known to you. What I did was
    i) Cash for share offer:

    Calculated the New Wealth of Birks Co. (No of shares * Cash per Share) and compared it with the Old Wealth (Ve) , and calculated the Gain % based on that.

    ii) Share for share offer:

    Calculated the New shares to be issued to Birks Co (60m/5 * 4), added it to the Shares of Arnison Co, which gave the total no of shares in the new co. Then divided it by the Ve of New company to get the value per share.
    Then I Multiplied the value per share by the number of shares of both companies (after acq), which gave me the Ve. And compared the new Ve to the Old Ve. Which Eventually gave the same answer as the examiner.

    Is this approach correct? Would I get marks if I attempt it this way?

    May 27, 2023 at 9:38 am #685173
    John Moffat
    Keymaster
    • Topics: 56
    • Replies: 52529
    • ☆☆☆☆☆

    Yes – you would certainly still get the marks 🙂

  • Author
    Posts
Viewing 2 posts - 1 through 2 (of 2 total)
  • The topic ‘ARNISON CO (PRE June Mock 2023)’ is closed to new replies.

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