Power Bhd is considering raising new finance by a right issues of 2million new ordinary shares of RM0.50 each at RM1.60. Currently the share price is RM1.80 and the issued ordinary share capital is RM8million. Shareholders are entitled to 2 new shares for every 8 shares held.
(a) How much will be raised by the new issues if issue cost are 3% of the gross proceeds?
(b) What will be the theoretical ex-right price of the shares?
(c) What is the value of the right to subscribe owned by an investor with 8 existing shares of the company?
(d) Show the relevant section of the Balance Sheet if the shares premium was RM400,000 before the issue and show total share capital?
(e) what will happen to the right of those investors who do not subsribe? justify your answer with the calculation?
Please reply me answer and working as fast as possible,because this is my assignment question. thank you!

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amit singh

  • Oct 16th, 2013

Finance means it is the provision of money at the time when it is required for the business. its inflow and outflow of the business. without money their is money.

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