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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › share capital need an answer please
Net assets 900,000 Ordinary share capital 400,000
(400,000 shares of £1 each fully paid)
Share Premium 100,000
Revaluation reserve 200,000
Revenue reserves 200,000
900,000 900,000
The directors of the company have decided to make a bonus issue on a one-for-two basis, followed immediately by a rights issue on a one-for-four basis, at a premium of 60p.
You are required to prepare a balance sheet after the above share issues have taken place and to explain the changes that have occurred in the reserves of the company. Assume the company wishes to retain the maximum dividend payment potential.
Presumably you have an answer in whichever book you found the question, so please say what problem you are having with the answer and I will then help you.
(and if you watch the free lecture on limited companies, then all of this is explained!)