Accounting 9706 · AS & A Level · Preparation of financial statements

Preparation of financial statements — practice question

The equity part of the statement of financial position for a limited company at 1 January is given below: ordinary shares at $2 each $450000 retained earnings amounting to $150000 On 28 February, the company carried out a rights issue of 1 new share for every 3 existing shares held, at a premium of $1.50 per share. The rights issue was fully subscribed. What cash amount was received from the rights issue?

  • A$112500
  • B$225000
  • C$262500
  • D$525000

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