june 2018, F9, past question paper TIN COMPANY , sub question 2 ,Assuming equity finance is used, calculate the revised earnings per share after the business expansion.
How did we get the 3000000 million as Increased number of shares??
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TIN CO
5y ago#1There are currently 2,500,000 shares in issue.
They have a 1 for 5 rights issue and therefore issue 500,000 new shares.
Therefore they end up with 2,500,000 + 500,000 = 3,000,000 shares.
Alright, thank you.
5y ago#3You are welcome :-)
Tin co, question no 5 calculation of gearing why add 2000 in debt & equity
Tin is potentially raising 2 million in either debt or equity
So you do the calculations as they were D/E and the new D/E one with 2m debt and again with equity
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