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Redemption of preference shares

Accountancy

In your YouTube video , redemption of pref share , we learnt that , we have to divide the preference share holder value by fv of equity to find no of equit shares to be issued, but in the (1hr 02 min) video. It’s adding the premium with fv as issue price and dividing . Pls explain

ponmani sabu

CA Inter

★ 0

30-Sep-23 10:51

331

Answers (9)

Best Answer

That's probably because the fund required from equity is 37500 And how many shares do you need to issue to fill that gap 37500/60 since fresh issue is at@60 =625shares Now 625shares @50=31250 Premium 625@10=6250 total amount equal to 37500

Shrikant

CA Inter

★ 1K+

30-Sep-23 12:24

If possible post that question over here.

Balachandar S

CA Inter

★ 59K+

30-Sep-23 11:17

Balachandar S

If possible post that question over here.

In this illustration, the video has changed the que to issues of equity shares at premium too . That is 50 fv and 10 premium . So they do 37500 shares divided by 60 instead of of 50 . Is it because the amount payable on redemption also has premium ?

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Thread Starter

ponmani sabu

CA Inter

★ 0

30-Sep-23 11:21

Even I'm having this doubt.. Please explain sir.

surya prakash

CA Inter

★ 2K+

30-Sep-23 12:05

Funds required from fresh issue 37500 No: of shares to be issued =37500/50 =750shares What's your doubt then

Shrikant

CA Inter

★ 1K+

30-Sep-23 12:16

Shrikant

Funds required from fresh issue 37500 No: of shares to be issued =37500/50 =750shares What's your doubt then

No , please read my que again . In the video the question has been changed to issue with premium too . 50 fv and 10 Prem .

Thread Starter

ponmani sabu

CA Inter

★ 0

30-Sep-23 12:18

Total shared need to be issued = 37500/60 = 625 for the purpose of Funds For the redemption of Ps. We have to consider only FV 37500/50 if u do I'll get 750 SH...

Balachandar S

CA Inter

★ 59K+

30-Sep-23 12:25

Balachandar S

Total shared need to be issued = 37500/60 = 625 for the purpose of Funds For the redemption of Ps. We have to consider only FV 37500/50 if u do I'll get 750 SH...

That’s greatttt !! Thank you so muchhh

Thread Starter

ponmani sabu

CA Inter

★ 0

30-Sep-23 12:29

Thread Starter

ponmani sabu

That’s greatttt !! Thank you so muchhh

Always Wlcm ✨✨✨😄

Balachandar S

CA Inter

★ 59K+

30-Sep-23 12:37