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What is the total cost of the new investment

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Question - On January 1, 2020, Scoundrel Company purchased 100,000 ordinary shares at $80 per share to be classified as nontrading through other comprehensive income. On September 30, 2020, the entity received 100,000 share rights to purchase 20,000 shares at $90 per share. On the same date, each share had a market value of $114 and the share right had a market value of $6. The share rights had an expiration date of February 1, 2021.

1. What amount should be reported on September 30, 2020 as investment in share rights?

2. What is the total cost of the new investment if all the share rights are exercised? Provide the journal entry.

3. What is the total cost of the new investment if all the share rights are exercised? Provide the journal entry.

Reference no: EM132816805

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