1. EPS disclosures are a. Encouraged for all entities b. Required for all entities C. Encouraged for public entities and required for nonpublic entities. d. Required for public entities and encouraged for nonpublic entities.
1. EPS disclosures are a. Encouraged for all entities b. Required for all entities C. Encouraged for public entities and required for nonpublic entities. d. Required for public entities and encouraged for nonpublic entities.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Multiple Choice Theories
1. EPS disclosures are
a. Encouraged for all entities
b. Required for all entities
C. Encouraged for public entities and required for nonpublic
entities.
d. Required for public entities and encouraged for nonpublic
entities.
2. Earnings per share is calculated before accounting for which of the
following items?
a. Preference share dividend for the period
b. Taxation
c. Non-controlling interest
d. Ordinary share dividend
3. Undeclared dividends are deducted from profit or loss in the
earnings per share computation for which type of preference
shares?
a. Non-cumulative only.
b. Cumulative only.
C. Neither non-cumulative nor cumulative.
d. Both non-cumulative and cumulative
4. The following are considered returns to the preference shareholders
and are deducted in calculating profit or loss attributable to
ordinary equity holders, except
a. Undeclared dividends for the period on cumulative preference
b. Loss on settlement of preference shares.
C. Amortization of premium on increasing rate preference shares.
d. Consideration paid on induced conversion of preference shares.
shares.
Transcribed Image Text:5. Which of the following is incorrect regarding inclusion or shares in
the weighted average number of shares?
d. Ordinary shares issued as a result of the conversion of a debt
instrument to ordinary shares are included from the date that
interest ceases to accrue.
b. Ordinary shares issued in exchange for the settlement of a
lnability of the entity are included from the settlement date.
C. Ordinary shares issued for the rendering of services to the entity
are included as the services are rendered.
d. Ordinary shares issued in exchange for cash are included when
cash is received.
6. The weighted-average number of shares outstanding during the
period and for all the periods presented (other than the conversion
of potential ordinary shares) shall be adjusted for
a. Any change in the number of ordinary shares without a change
in resources.
b. Any prior-year adjustment.
C. Any new issue of shares for cash.
d. Any convertible instruments settled in cash.
7. If a bonus issue occurs between the year-end and the date that the
financial statements are authorized, then
a. EPS both for the current and the previous year are adjusted
b. EPS for the current year only is adjusted
C. No adjustment is made to EPS
d. Only the diluted EPS is adjusted
8. If a new issue of shares for cash is made between the year-end and
the date that the financial statements are authorized, then
a. EPS for both the current and the previous year are adjusted.
b. EPS for the current year only is adjusted
C. No adjustment is made to EPS.
d. Only the diluted EPS is adjusted
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