STL Corporation Berhad wishes to increase its production capacity by purchasing additional plant and equipment at...
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STL Corporation Berhad wishes to increase its production capacity by purchasing additional plant and equipment at a cost of RM3.8 million. The extracted profit and loss account for the year ended 31st December 2017 is as follows: RM million Sales turnover Profit before interest and taxation Interest Profit before tax Taxation Profit after taxation Earnings per share 15sen In order to finance the purchase of the new plant and equipment, the directors of the company have decided to make a rights issue equal to the cost of the equipment. The shares are currently quoted on the stock exchange at RM2.70 per share and the new shares will be offered to shareholders at RM1.90 per share. Required: (a) (b) Determine the theoretical ex-rights price per share. 140.6 8.4 6.8 1.6 0.4 1.2 Compute the value of the rights on each existing share. (10 marks) (5 marks) STL Corporation Berhad wishes to increase its production capacity by purchasing additional plant and equipment at a cost of RM3.8 million. The extracted profit and loss account for the year ended 31st December 2017 is as follows: RM million Sales turnover Profit before interest and taxation Interest Profit before tax Taxation Profit after taxation Earnings per share 15sen In order to finance the purchase of the new plant and equipment, the directors of the company have decided to make a rights issue equal to the cost of the equipment. The shares are currently quoted on the stock exchange at RM2.70 per share and the new shares will be offered to shareholders at RM1.90 per share. Required: (a) (b) Determine the theoretical ex-rights price per share. 140.6 8.4 6.8 1.6 0.4 1.2 Compute the value of the rights on each existing share. (10 marks) (5 marks)
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STL Corporation Berhad Rights Issue Analysis a Theoretical ExRights Price per Share Right Issue Disc... View the full answer
Related Book For
International Financial Reporting and Analysis
ISBN: 978-1408075012
5th edition
Authors: David Alexander, Anne Britton, Ann Jorissen
Posted Date:
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