The issued share capital of a company consists of 840,000 ordinary shares of £1 each. Half way through its financial year the company made a rights issue of 3 for 7 at an exercise price of £1.63 a share. The market value of the company's shares was £2.22 a share just before the rights issue.. The company reported a net profit after taxation for the year of £504,000. The market value of each ordinary share at the end of the year was £2.66. The theoretical ex-rights value per share is £2.04, and the adjustment factor is 1.086637. Calculate the weighted average number of shares which will be used in the calculation of earnings per share for the year.
The issued share capital of a company consists of 840,000 ordinary shares of £1 each. Half way through its financial year the company made a rights issue of 3 for 7 at an exercise price of £1.63 a share. The market value of the company's shares was £2.22 a share just before the rights issue.. The company reported a net profit after taxation for the year of £504,000. The market value of each ordinary share at the end of the year was £2.66. The theoretical ex-rights value per share is £2.04, and the adjustment factor is 1.086637. Calculate the weighted average number of shares which will be used in the calculation of earnings per share for the year.
Chapter14: Corporation Accounting
Section: Chapter Questions
Problem 21EB: Brunleigh Corporation earned net income of $200,000 this year. The company began the year with...
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Transcribed Image Text:The issued share capital of a company consists of 840,000 ordinary shares of £1 each.
Half way through its financial year the company made a rights issue of 3 for 7 at an exercise
price of £1.63 a share.
The market value of the company's shares was £2.22 a share just before the rights issue..
The company reported a net profit after taxation for the year of £504,000.
The market value of each ordinary share at the end of the year was £2.66.
The theoretical ex-rights value per share is £2.04, and the adjustment factor is 1.086637.
Calculate the weighted average number of shares which will be used in the calculation of
earnings per share for the year.
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The issued share capital of a company consists of 840,000 ordinary shares of £1 each.
Half way through its financial year the company made a rights issue of 3 for 7 at an exercise price of £1.63 a share.
The market value of the company’s shares was £2.22 a share just before the rights issue..
The company reported a net profit after
The market value of each ordinary share at the end of the year was £2.66.
The theoretical ex-rights value per share is £2.04, and the adjustment factor is 1.086637.
Calculate the weighted average number of shares which will be used in the calculation of earnings per share for the year.（maybe the answer is 1056388，but I don't know why）
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