26. Armstrong Co has produced the following net profit figures for the years ending 31 December. Sm 20X1 1.2 20X2 0.6 20X3 2.1 On 1 January 20X2 the number of shares outstanding was 600,000. During 20X2 the company announced a rights issue with the following details. Rights: 1 new share for each 4 outstanding Exercise price: $7.00 Last date to exercise rights: 1 May 20X2 The market (fair) value of one share in Armstrong immediately prior to exercise on 1 May 20X2 Required: Calculate the (a) EPS restated for rights issue for 20X1, (b) EPS for 20X2 and (c) EPS for 20X3. Show your calculations otherwise the answer will not be considered. = $10.00.
26. Armstrong Co has produced the following net profit figures for the years ending 31 December. Sm 20X1 1.2 20X2 0.6 20X3 2.1 On 1 January 20X2 the number of shares outstanding was 600,000. During 20X2 the company announced a rights issue with the following details. Rights: 1 new share for each 4 outstanding Exercise price: $7.00 Last date to exercise rights: 1 May 20X2 The market (fair) value of one share in Armstrong immediately prior to exercise on 1 May 20X2 Required: Calculate the (a) EPS restated for rights issue for 20X1, (b) EPS for 20X2 and (c) EPS for 20X3. Show your calculations otherwise the answer will not be considered. = $10.00.
Accounting (Text Only)
26th Edition
ISBN:9781285743615
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 15.4CPP: Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31,...
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Transcribed Image Text:26.
Armstrong Co has produced the following net profit figures for the years ending 31 December.
Sm
20X1 1.2
20X2 0.6
20X3 2.1
On 1 January 20X2 the number of shares outstanding was 600,000. During 20X2 the company announced a rights issue with the
following details.
Rights: 1 new share for each 4 outstanding
Exercise price: $7.00
Last date to exercise rights: 1 May 20X2
The market (fair) value of one share in Armstrong immediately prior to exercise on 1 May 20X2
Required:
Calculate the (a) EPS restated for rights issue for 20X1, (b) EPS for 20X2 and (c) EPS for 20X3.
Show your calculations otherwise the answer will not be considered.
= $10.00.
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