dfs equity section

Options
meibaker
meibaker Registered Posts: 481 Dedicated contributor 🦉
hi, please someone explain the equity section for me please,
thank you!
equity.................................08......................07
share capital...................8,000,000...............6,000,000
share premium................4,200,000................1,200,000

suggested answers:
The share capital and the share premium have both increased due to the issue of 2,000,000 new shares. These were issued at £2.50 per share and therefore increased share capital by £2,000,000 (2,000,000 at £1 par value per share) and share premium by £3,000,000 (2,000,000 at £1.50 premium per share).

i still not sure how the issue of 2,000,000 new shares comes from?
please help

Comments

  • jewels.p
    jewels.p Registered Posts: 1,774 Beyond epic contributor 🧙‍♂️
    Options
    meibaker wrote: »
    hi, please someone explain the equity section for me please,
    thank you!
    equity.................................08......................07
    share capital...................8,000,000...............6,000,000
    share premium................4,200,000................1,200,000

    suggested answers:
    The share capital and the share premium have both increased due to the issue of 2,000,000 new shares. These were issued at £2.50 per share and therefore increased share capital by £2,000,000 (2,000,000 at £1 par value per share) and share premium by £3,000,000 (2,000,000 at £1.50 premium per share).

    i still not sure how the issue of 2,000,000 new shares comes from?
    please help

    I am not quite sure what you mean meibaker? Does it tell you that the shares were issued?
  • Steve Collings
    Steve Collings Registered Posts: 997 Epic contributor 🐘
    Options
    The question will usually tell you that there has been a share issue. However, in the answer quotation in meibaker's post, you can see there has been an issue of shares because the share capital itself has gone up by 2m shares.

    Regards
    Steve
  • meibaker
    meibaker Registered Posts: 481 Dedicated contributor 🦉
    Options
    The question will usually tell you that there has been a share issue. However, in the answer quotation in meibaker's post, you can see there has been an issue of shares because the share capital itself has gone up by 2m shares.

    Regards
    Steve
    hi jewels:
    this is a question from the past exam, it asks you to explain the equity.

    can i ask something very quitely please steve.
    share capital are all value at £1 per share?am i right? that's why it went up to 2m shares!
  • jewels.p
    jewels.p Registered Posts: 1,774 Beyond epic contributor 🧙‍♂️
    Options
    Sorry for answering for Steve but yes thats right. You can calculate how much the share and share premium are by looking at the two years.
  • meibaker
    meibaker Registered Posts: 481 Dedicated contributor 🦉
    Options
    thank you jewels! i am sure steve doesn't mind, he might employs you as his assistant! ;-)
  • jewels.p
    jewels.p Registered Posts: 1,774 Beyond epic contributor 🧙‍♂️
    Options
    meibaker wrote: »
    thank you jewels! i am sure steve doesn't mind, he might employs you as his assistant! ;-)

    I doubt that! :laugh:
Privacy Policy