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Need detail explanation for situation b. Company issues (sells) 5,000 ordinary shares and 5,000 preferred shares for a total of $160,000 Situation A - market
Need detail explanation for situation b.
Company issues (sells) 5,000 ordinary shares and 5,000 preferred shares for a total of $160,000 Situation A - market price of ordinary is $20 and market price of preferred shares is $16. The company elects to use the relative market value method to value. Situation B - market price of ordinary is $20 and market price of preferred shares is unknown as it is a new issue. The company elects to use the residual value method to valueStep by Step Solution
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