SISA Ltd is a company with 40 000 authorised Ordinary Share Capital with a par value of R1. The company issued 30 000 shares at R1.30 for each share. What would be the effect of this transaction in SISA’s records? Select one: a. Ordinary share capital will increase by R39 000 and share premium will be unaffected. b. Ordinary share capital will increase by R39 000 and share premium will increase by R9 000. c. Ordinary share capital will increase by R30 000 and share premium will increase by R39 000. d. Ordinary share capital will increase by R30 000 and share premium will increase by R9 000.

3-39 CVP analysis, medical sector. Yahama Medical Centre operates a medical surgery in Japan that specializes in the diagnosis and treatment of hay fever allergies. The firm's budget for next year is as follows: Number of beds available In-patient days In-patient fees 80 per day 26,000 per annum ¥1,300,000 Variable Costs Fixed Costs Total Costs Direct supplies ¥ 100,000 ¥ 100,000 Direct salaries Patient service O/H Administration Total costs 800,000 800,000 58,000 ¥102,000 160,000 108,000 ¥1,066,000 150,000 ¥252,000 258,000 ¥1,318,000 1. Calculate the contribution margin ratio. 2. Compute the breakeven point in both in-patient days and in-patient fees. 3. Compute the margin of safety ratio if the clinic operates at full capacity. 4. Suppose the direct salaries were increased to ¥826,000 and total variable costs increased to ¥1,092,000, compute the breakeven point in in-patient days if all matters not specified remain the same. 5. Suppose the fixed patient service overheads increase to…

The LL Company will issue shares of P10 par value common stock for all the assets and liabilities of the OO Company. LL Company’s common stock has a current market value of P40 per share. The OO Company’s net assets were as follows:   Current Assets                                                  1,280,000 Non-Current Assets                                         3,520,000 Liabilities                                                            1,600,000   The fair market value of the current assets is P1,600,000 while that of the non-current assets is 6,400,000. All of the liabilities are correctly stated. LL Company issued sufficient shares of stock so that the fair market value of the stock is equal the fair market value of OO Company’s net assets. Referring to the previous item,  To have a goodwill of P800,000, the number of shares to be issued by LL should be?    144,000 178,000160,000 180,000

Company A has earrings per share of $3 with 20 million shares outstanding. The current market price of Company As Stock is $40 per share. Company A is in process of acquiring Company B., which has earnings per share of $1.50, 4 million of common stock shares. Currently, Company Bs stock trades at $25. The acquisition will be done 100% by stock issue by Company A. Exchange ratio will be set in a way that, at current pre-announcement share prices for both firms, the offer represents a 10% premium to buy Company B. What will be the price per share of Company A immediately after the announcement of acquisition? What will be subsequent price action in both Company As and Company Bs stocks? Explain briefly.