Question: could you please explain thoroughly how to solve it, I have a ready answers but dont know how they got it? Question 5.1 Ozy Plc

 could you please explain thoroughly how to solve it, I have

could you please explain thoroughly how to solve it, I have a ready answers but dont know how they got it?

Question 5.1 Ozy Plc issued 200,000 ordinary shares with a nominal value of 50p for 1.50 each and then issued bonus shares, in respect of all its ordinary shares, on a 4 for 1 basis. Before the share issue and the bonus issue Ozy Plc's share capital and reserves were as follows (in s): Ordinary share capital (50p shares), 750,000 Share premium 2,250,000 Preference share capital 600,000 Retained profits 24,000,000 Total 27,600,000 Show the capital and reserves of Ozy Plc after the share issues, Hint: In answering the question take care in interpreting '4 for 1 basis'. In a written answer, you are encouraged to clarify your interpretation. A good way of thinking of 4 for l' is that where there was previously one share there are to be 4 (that is, an additional 3)

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