Bonus issue and a rights issue of shares

Assignment Help Macroeconomics
Reference no: EM131214790

XY has recently begun to lease an expensive machine. The lease agreement effectivelymeans that XY takes on substantially the risk and rewards associated with owning the asset.The managing director has instructed XY's finance director to treat the lease as an operatinglease in order to show a better financial position.(c)CD had 5,000,000 $1 ordinary shares in issue.Subsequently, CD made a rights issue of 1 new ordinary share at $3.50 per share for every 5ordinary shares currently held. At the same date CD's ordinary shares were trading at $4.75.(d)PU purchased machinery on 1 April 2011 for $350,000.PU depreciates machinery over 10 years, using the straight line method assuming no residualvalue.Required:Explain any ethical issues that this may cause for the finance director.

Required:

(i) Explain the difference between a bonus issue and a rights issue of shares.

(ii) Prepare the journal entries required to record CD's rights issue in its financial records, assuming that all rights were taken up.

Reference no: EM131214790

Questions Cloud

What is the current health status of this minority group : Describe at least one approach using the three levels of health promotion prevention (primary, secondary, and tertiary) that is likely to be the most effective given the unique needs of the minority group you have selected. Provide an explanation ..
Calculate the generalized reflection coefficient : Assume the generator is matched to the line but the load is not. Dimensions are in wavelengths.
Find the probability that the first ace is drawn : Find the probability that the first ace is drawn on the 5th selection. -  Find the probability that at least 5 cards are drawn before the first ace appears.
Find the probability that at least 8 cards are drawn : Find the probability that the 3rd club is drawn on the 8th selection. - Find the probability that at least 8 cards are drawn before the 3rd club appears.
Bonus issue and a rights issue of shares : (i) Explain the difference between a bonus issue and a rights issue of shares. (ii) Prepare the journal entries required to record CD's rights issue in its financial records, assuming that all rights were taken up.
What are the implications of this practice for the patients : In what ways have private practice physicians responded to the expansion of hospital, health plans' and other organization-sponsored ambulatory services? What are the implications of those responses for the patient, for the consumer, and for the ..
Find the closest location d to the load : Find the closest location d to the load at which you can move the generator so that the generator is best matched to the line (that is, the reflection coefficient at the generator is minimum). Assume the phase constant on the line is known as β0.
What is the probability that word cannot be recalled : If a particular word is stored in n different places in the memory, what is the probability that this word cannot be recalled if one-half of the memory is erased by electromagnetic radiation?
Discuss the various types of sexually transmitted diseases : How you will integrate knowledge from evidence-based practice in creating a holistic plan of care for patients with sexually transmitted diseases?

Reviews

Write a Review

Macroeconomics Questions & Answers

  Draw the budget constraint showing the trade-off between

Draw the budget constraint showing the trade-off between dining hall meals and Cups O’ Soup. Assuming that he spends equal amounts on both goods, draw an indifference curve showing the optimum choice. Label the optimum as point A.

  Information technology it has been around for a long time

information technology it has been around for a long time but most health care organizations have not embraced

  Why is health considered an element of human capital

Why is health considered an element of human capital?- What was the productivity slowdown?- What is efficiency? How are efficiency, technology, and productivity related?

  Explain college grade point average

In a multiple regression model using 400 students to explain college grade point average, the following explanatory variables and a constant term equal to 1 are initially included in the regression: high school GPA, ACT score, number of credits co..

  Explain the approach to governmental health care funding

the type of health care problems experienced directly to patients who then would be free to choose their health care providers. wherther or not you agree, can you give an economic rationale for this approach to governmental health care funding

  How the economic performance measures of gdp

Prepare a 2-3 page paper indicating how the economic performance measures of GDP, inflation, and unemployment statistics can be utilized by construction managers to improve decision-making.Offer some specific examples.

  How much of the social security benefits must be include

Determine how much of the Social Security benefits must be include in income for a single individual who had $20,000 in dividend income and $5,000 in interest from tax-exempt bonds in addition to receiving $10,000 in Social Security benefits.

  Stabilization policy recommendations of monetarists

Describe briefly the reasons why the following transactions would  or would not be included in GNP and  compare and contrast stabilization policy recommendations of  monetarists and activists.

  Production for half of what canada produces

In particular, suppose the US trades Canada half of its production for half of what Canada produces? How many additional shirts will the US have adter the trade? How many additional boots?

  Determine the total number of occurrences

Write a javascript program that inputs several lines of text and uses String method index Of to determine the total number of occurrences of each letter of the alphabet in the text. Uppercase and lowercase letters should be counted together. Store..

  Find out the equilibrium price - the equilibrium quantity

Find out the equilibrium price, the equilibrium quantity, the output supplied by each firm and the profit of the firm in the short run.

  Question regarding the capital spending program

Assuming the firm has a 20-year life and the appropriate interest rate is 12 percent, should the capital spending program be implemented?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd