Page 37 - Ebook Financial Accounting 3
P. 37
Extract from the Statement of Financial Position of Samudera Bhd
RM
Current Assets
Bank 600,000
Equity
Issued share capital
500,000 ordinary shares of RM1.20, fully paid 600,000
2.5 The Nature of Bonus Share, Pre-Emptive Right to New Shares (Right Issue)
and Conversion of Preference Shares
a) Bonus Share
Bonus issue involves giving of additional shares to shareholders in proportion to shares held
without any payment being made. For example, if a company were to declare a two-for-five
bonus issue, a holder of five shares will receive two shares free. The issue of bonus shares does
not involve any outflow of funds.
Example:
Bijork Bhd
Statement of Financial Position as at 31 December 2019
RM
Non-current Assets 900,000
Current Assets 300,000
1,200,000
Equity
800,000 Ordinary Shares 800,000
Retained Profits 400,000
1,200,000
31
