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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › value of rights
sir what is the value of rights per existing share . 2 for 5 and the value of rights is $0.50..
If the value of the rights is 0.50 per new share, then the value for each existing share is (2 x $0.50) / 5 = $0.20.
so if it was 3 for 5 then we would multiply by 3 right sir?
Yes.
Sir is it not per exisiting share so why multiply by 2?
In your first post. there were 2 are shares and so we multiplied by 2. In your second question there were 3 new shares and so we multiplied by 3.
In both cases, since they were given for holding 5 existing shares we divided by 5.