While preparaing the investments a/c,d sale proceeds of the rigth shares r to be taken 2 P/L a/c,but when investments r acquired on cum right basis & d market value of investments immediately after their becoming ex right is lower than d cost & which they were acquired, it should be reduced from d carrying amount
wht does cum rigth basis exactly means?? If d market value at d end of d year is given& of immediately then wht be its treatment?
thanks in advance....
The buyer of a cum-rights share is entitled to subscribe to the forthcoming rights issue announced by the company.
The date up to which a share can be bough cum-rights is announced y the company. After this date the share becomes ex-rights. Cum-rights shares are usually sold at a price higher than XR shares.
Regards:
in both cases of interest and shares if question is silent then it will be ex right
agree with mohammad
CAclubindia
