Question

14. Intrinsic value of each equity share of
the transferor company is Rs. 250 and
that of the transferee company is Rs.
400. The ratio of exchange of shares on
the basis of intrinsic value is ..........
O 2:1
O 8:8
O 8:5
O 9:7​

Answer 1

Answer:

8:5

Explanation:

According to the information provided in the question it is given as

Intrinsic value of each equity share of

The Transferor company =Rs. 250

Transferee company = Rs.400.

The ratio of exchange of shares on

The basis of intrinsic value is=?

We need to find from options

Let us make an equation of ratio and solve it  we get the answer

Transferee : Transferor

400:250

400 /250

Finding the lowest term we get

8 / 5

(As both are divisible by 50 )

Further lowest value is not possible hence final value is

8 /5 or we can write as (8:5)

Answer 2

Given:

The equit share of transferor company = Rs. 250

The equity share of Transferee company = Rs.400. 

To Find:

The ratio of exchange of shares on the basis of intrinsic value

Solution:

This value is the measure fof an asset's total worth which includes calculating the present value of these flows.

Employing the formula -

Transferee : Transferor

= 400:250

Thus, solving

= 400 /250

= 40/25

= 8/5

Answer: The ratio of exchange of shares on the basis of intrinsic value is 8:5