The following is a summarized statement of financial position (balance sheet) of Nithsdale Ltd.
................................................................. £000s
Cash .............................................................. 20
Other assets less liabilities ................................... 320
................................................................... 340
Ordinary shares (400,000 of 25 pence each) .............. 100
Share premium .................................................. 40
Reserves of retained profit .................................. 200
................................................................... 340
The company is considering three possible changes to its capital structure:
(a) Issue for cash 50,000 additional ordinary shares at £1 per share, fully paid; or
(b) Make a 1 for 4 capitalization issue of ordinary shares; or
Show separately the impact of each change on the statement of financial position (balance sheet) of the company.