14. Adam Company owns 50,000 ordinary shares of Bland Company, which has several hundred thousand shares publicly traded. These 50,000 shares were purchased by Adam in 2016 for P120 per share. On August 30, 2018, Bland distributed 50,000 stocks rights to Adam. Adam was entitled to buy one new share of Bland Company for P90 cash and two of these rights. On August 30, 2018, each share had a market value of P130 and each right had a market value of P20. What total cost should be recorded for the new shares that Adam acquired by exercising the rights?
14. Adam Company owns 50,000 ordinary shares of Bland Company, which has several hundred thousand shares publicly traded. These 50,000 shares were purchased by Adam in 2016 for P120 per share.
On August 30, 2018, Bland distributed 50,000 stocks rights to Adam. Adam was entitled to buy one new share of Bland Company for P90 cash and two of these rights. On August 30, 2018, each share had a market value of P130 and each right had a market value of P20.
What total cost should be recorded for the new shares that Adam acquired by exercising the rights?
15. On March 1, 20118, Evan Company purchased 10,000 ordinary shares of LVC at P80 per share. on September 30, 2018, Evan received 10,000 stock rights to purchase an additional 10,000 shares at P90 per share. The stock rights had an expiration date on February 1, 2019. On September 30, 2018, LVC's share had a market value P95 and the stock right had a market value of P5.
What amount should Evan report in its September 30, 2018
16. Excelsia Company issued rights to subscribe to its stock, the ownership of 4 shares entitling the shareholders to subscribe for 1 share at P100. Jealina Company owns 50,000 shares of Excelsia Company with total cost of P5,000,000. The share is quoted right-on at 125. The stock rights are accounted for separately and measured initially at fair value.
What is the cost of the new investment if all of the stock rights are exercised by Jealina Company?
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