You are given the following extract from the statement of financial position for Brad Pitt plc as at 31 March 20X8. Equity Share capital (1 nominal value) Share premium Revaluation reserve Retained profits m 280 976 42 6584 1,956 During the year to 31 March 20X9, Brad Pitt plc engages in the following activities: < (i) To finance an acquisition in China, the company made a 4 for 7 rights issue. The share price at the date of the rights issue was 12 and the price of the rights issued was 10.60. All rights were taken up. < (ii) The company owns land purchased on 31 March 20X3 for 10 million. The directors had this land revalued on 31 March 20X9 by professional valuers at 18 million. The company has an accounting policy of regular revaluations of land and recording the revalued amount in the statement of financial position. < (iii) During the year, the company spent 40 million on research expenditure to develop a new product. This was recorded in the statement of financial position as an intangible asset. The new product remains uncertain and even if it works will only be available in the long term. < (iv) The company paid a dividend during the year of 23 million and has declared a dividend for the year end 31 March 20X9 of 26 million. Profits for the year before dividend payments were 128 million and there were no other changes in equity other than those referred to in (i) to (iv) above. < 2 Required (a) Calculate the cash raised by the rights issue and the theoretical price for a single right to purchase a share of Brad Pitt plc assuming all rights are taken up. Show your workings. (b) Show calculations and provide an explanation of the financial consequences of the options available in respect of the rights issue to an investor who holds 7 million shares in Brad Pitt plc prior to the rights issue. Recommend what the investor should do in relation to the rights issue. (c) Produce the statement of changes in equity (SOCE) for Brad Pitt plc at 31 March 20X9 taking account of the information in (i) to (iv) above. Show your workings and use an appropriate heading for the statement.