Tusker Corporation is considering a 3- for- 2 share split. It currently has the shareholder’s equity position shown. The current share price is R120 per share. The most recent periods earnings available for ordinary shares are included in retained earnings. Preference shares R1 000 000 Ordinary shares (100 000 shares at R3 R300 000 per share Share premium R1 700 000 Retained earnings R10 000 000 Total shareholders’ equity R13 000 000 Explain the differences between share splits and dividends.
QUESTION 3.5
Tusker Corporation is considering a 3- for- 2 share split. It currently has the shareholder’s equity position shown. The current share price is R120 per share. The most recent periods earnings available for ordinary shares are included in
Ordinary shares (100 000 shares at R3 R300 000
per share
Share premium R1 700 000
Retained earnings R10 000 000
Total shareholders’ equity R13 000 000
Explain the differences between share splits and dividends.
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