Question
In 2007,Orlando Conrpany issued for P105 per share, 8,000 shares of P100 par value convertible preference share capital. One preference share can be converted into
In 2007,Orlando Conrpany issued for P105 per share, 8,000 shares of P100 par value convertible preference share capital. One preference share can be converted into three ordinary shares of Orlando's P25 par value at the option of the shareholder.
In August 2008, all of the preference shares were converted into ordinary shares. The market value of the ordinary share on the date of conversion was P30 per share. (V7-36)
______What amount should be credited to share premium as a result of the issuance of the
preferenceshare and its subsequent conversion into ordinary share?
a.P120,000b. 240,000c. 200,000d. 80,000
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