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please use the information to calculate all required questions Office Systems (Pty) Ltd has the following capital structure: 6 million ordinary shares at R1.00 each
please use the information to calculate all required questions
Office Systems (Pty) Ltd has the following capital structure: 6 million ordinary shares at R1.00 each 6 000 000 Retained earnings 1 200 000 7 200 000 The board of directors is planning a major capital expansion programme and intends raising an additional R3 000 000 from a rights issue. The current market price is R1.80 per share and the company can achieve a return on capital employed of 25% at present. The company is considering the following possible rights issue prices: R1.60 R1.40 R1.20 R 1.00 . . Required: Use the information provided to calculate the following: 4.1. The current earnings of the company 4.2. The current earnings per share 4.3. The after-tax earnings after the rights issue 4.4. The number of new shares that will have to be issued at each rights issue price 4.5. The total number of shares that will be in issue at each rights issue price 4.6. The earnings per share (EPS) at each rights issue price 4.7. The extent of EPS dilution at each rights issue price Show all formulas and calculations. (3) (3) (4) (5) (5) (5) (5Step by Step Solution
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