Ponting Ltd's paid-up capital currently comprises 4 000 000 shares issued fully paid for $14.00.The directors of Ponting Ltd have decided to undertake a capital reduction.
-What will Ponting Ltd's share capital be if the directors decided to return $3.50 per share to its shareholders?

Question

Quizplus · Accepted Answer

The original share capital is 4,000,000 shares at $14.00 each, totaling $56,000,000. If $3.50 is returned per share, the new share capital per share is $14.00 - $3.50 = $10.50. Therefore, the new total share capital is 4,000,000 shares * $10.50 = $42,000,000.

Ponting Ltd's Paid-Up Capital Currently Comprises 4 000 000 Shares