Illustration 15

James leyoun mak X Co limited has the following capital structure:

400,000 ordinary shares of 50c. $ 200000

Share premium account. $70000

Retained earnings. $ 230000

Shareholders' equity. $500,000

You are required to Show its capital structure following:

(a) A '1 for 2' bonus issue

(b) A rights issue of '1 for 3' at 75c following the bonus issue, assuming all rights taken up