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Suppose a company issues: 100,000 Ordinary Shares at PAR= $2. Market Value = $6 per Ordinary Share: 100,000 Preference Shares at PAR= $5. Market Value

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Suppose a company issues: 100,000 Ordinary Shares at PAR= $2. Market Value = $6 per Ordinary Share: 100,000 Preference Shares at PAR= $5. Market Value = $6 per Preference Share. The two share issues take place at the same time. The company receives $1,000,000 for the combined share issue (i.e., for both the Ordinary and Preference Shares). Using the Proportional Method, the pro-rata proceeds of the share issue are divided between the two share categories as follows: Select one: O a Ordinary Shares Total = $600,000. Preference Shares Total: $600,000 O b. Ordinary Shares Total = $600,000. Preference Shares Total: $500,000 Ordinary Shares Total = $500,000. Preference Shares Total: $500,000 Od. None of these answers O e. Ordinary Shares Total = $500,000. Preference Shares Total: 5600,000

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