ACCA F3 Capital Structure
L co, a limited liability company has the following capital structure:
| Share Capital | $'000 |
| 50c Ordinary Shares | 67,500 |
| Share Premium | 240,000 |
| 307,500 |
The company made a bonus issue of 2 shares for every 3 shares held using the share premium account for the purpose.
What was the company’s capital structure after the bonus shares?
(Ordinary share capital and Share premium account)
Suggested Solution:
| Share Capital | No of shares at 50c | $'000 | |
| Original | 50c Ordinary Shares | 135,000 | 67,500 |
| Bonus 2 for 3 | 90,000 | 45,000 | |
| Total | 225,000 | 112,500 |
| Share Premium | $'000 |
| Original | 240,000 |
| Less Bonus 2 for 3 | (45,000) |
| New Premium | 195,000 |
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