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Hello Chris
Hope you are doing well.Sorry if it a silly question. I have looked the answer of above example at the back. I am happy with the solution but one thing I am unsure is the fraction in the solution is 3/2 and at the bottom not sure if there is any typing error that “number of shares in issue after”is divided by “number of shares in issue after” and result comes 3/2.
I would really appreciate if you can be kind to explain how that 3/2 came from?
Kind Regards
MohammadHi Mohammad,
I’m well, thanks. Hope your studying is going well.
For the bonus issue of shares we have to adjust the previous amount of shares in issue as if the bonus issue had always been in place. To do this we can apply a bonus issue fraction to the number of shares that were in issue. The fraction is the number of shares in issue after divided by the number before.
In this example it was a 1-for-2, so there were 2 in issue before and three in issue after (2+1).
Hope that helps clear it up.
Thanks
Chris
Hello Chris,
Hope you are doing well. Thanks for your response.
It helped. I think the typing error in answer at the back made me bit confuse. Thanks a lot. It’s clear now.
Have a good weekend.
Kind Regards
Mohammad AlamHi Chris,
Why was this not done for the prior example then? Part C in example 1.
Thanks
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