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Standard XII

Accountancy

Authorised Share Capital

Under the yie...

Question

Under the yield method of valuation of equity share capital, if for an equity share of 50, the normal rate of return is 10% and expected rate of return is 5%, then the value of an equity share will be _______.

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100

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Solution

The correct option is A 25
value of equity shares=(expected rate/normal rate)* paid up value
= (0.05/0.1)*50
value of equity shares =25

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Under the yield method of valuation of equity share capital, if for an equity share of 50, the normal rate of return is 10% and expected rate of return is 5%, then the value of an equity share will be _______.

The correct option is A 25value of equity shares=(expected rate/normal rate)* paid up value = (0.05/0.1)*50 value of equity shares =25

The correct option is A 25
value of equity shares=(expected rate/normal rate)* paid up value
= (0.05/0.1)*50
value of equity shares =25