Example: Bonus issues On 1 January 20X1, ABC Ltd has 100,000 ordinary shares in issue and 50,000 10% preference shares. On 1 October 20X1, ABC declared 1 bonus share for every 2 existing shares held. Profit after tax for 20X0 and 20X1 were $45,000 and $55,000 respectively. Determine basic EPS for 20X0 and 20X1. 20X1 20X0 Profits attributable to ordinary shareholders 500,000 400,000 No. of ordinary shares at year end Basic EPS (original calculated) 2,000,000 1,000,000 $0.25 $0.4 EPS for 20X0=40,000 100,000 = $0.4 EPS for 20X1 = 50,000 / 150,000 = $0.33 EPS for 20X0 (restated) = $0.4 ÷ BAF 3/2 = $0.27 Bonus adjustment factor (BAF) = 1 + bonus issue ratio = 1 + 1 = 3/2

Example: Bonus issues On 1 January 20X1, ABC Ltd has 100,000 ordinary shares in issue and 50,000 10% preference shares. On 1 October 20X1, ABC declared 1 bonus share for every 2 existing shares held. Profit after tax for 20X0 and 20X1 were $45,000 and $55,000 respectively. Determine basic EPS for 20X0 and 20X1. 20X1 20X0 Profits attributable to ordinary shareholders 500,000 400,000 No. of ordinary shares at year end Basic EPS (original calculated) 2,000,000 1,000,000 $0.25 $0.4 EPS for 20X0=40,000 100,000 = $0.4 EPS for 20X1 = 50,000 / 150,000 = $0.33 EPS for 20X0 (restated) = $0.4 ÷ BAF 3/2 = $0.27 Bonus adjustment factor (BAF) = 1 + bonus issue ratio = 1 + 1 = 3/2

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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This slide is so confusing, can you explain every steps and calculation?
At 1 January 20X9, company X had in issue 10 million ordinary shares. On 30 April 20X9, company Xmade a 2 for 5 rights issue at £1.20 per share. At that date the share price (before the issue wasannounced) was £1.60 per share. The earnings of the company were £3m for 20X9.Calculate the basic EPS for 20X9.
BEPS - rights issue A company has 1,000,000 shares in issue at that start of the year. During the year, a rights issue of one new share for every four shares was made at a price of £5 per share. The pre-issue market price was £6.50 per share. The theoretical ex-rights price (TERP) is: Select one: O a. £5.00 b. £6.20 C. £5.30 O d. £6.00
PROVIDE COMPUTATION
purchased for P120 per Problem 16-14 (AICPA trading. These 50,000 shares were rights to the investor. and two of these rights. Each share had a market value of P130 and each right had market value of P20 on the date of issue. a What total cost should be'recorded for the new shares that are acquired by exercising the rights? a. 2,250,000 b. 3,250,000 c. 3,050,000 d. 5,500,000
Company X has a June 30th year-end. On 1 July 20X5 company X issued £40 million 10%convertible loan stock at par. The terms of conversion (on 1 July 20X9) are that for every £200 ofloan stock, 40 ordinary shares will be issued at the option of loan stockholders. The income tax is25%. Earnings attributable to ordinary shareholders for the year ended 30th June 20X6 were£32.4m and 60 million ordinary shares in issue. You may assume that the convertible loan stock isdilutive.Calculate company X’s diluted EPS for the year ended 30th June 20X6
1. Avalanche Inc. revealed the following information for the year ended December 31. 2021 Preference share. P100 par-P2.4 million; Share premium, preference - P700,000; Ordinary share, P15 par-P3.5 million, Share premium, ordinary-P1.5 million. Subscribed ordinary share - P100,000, Retained earnings - P2 million, Subscription receivable, ordinary - P20,000 How much is the legal capital? A.P6 million B.PB 1 million CP5.9 million D.P8 2 million 2.At the beginning of 2021, DAI Corp. was organized with authorized capital of 200,000, P500 par value shares. The following transactions transpired during its first year of business. February 4- Issued 15.000 shares at P510 per share April 10- Issued 3,000 shares for services received (FMV of the services is P1.7 million). October 23-Issued 5,000 shares in exchange for a land (FMV) the land is P3 million) What amount should be reported as share premium? A.11.500.000 B. 23.000 C.850.000 D.12.350.000 3. At the beginning of 2021, DAI Corp. was…
8. Prepare or provide what is require of the problem below
TRUE OR FALSE When 10,000 shares of P20 par value ordinary shares are issued in payment for a parcel of land with a fair market value of P300,000, the Ordinary Shares account is debited for P200,000, and the Share Premium account is debited for P100,000.
Please answer numbers 16 and 17:
20.Corridor Company issued 6,000 share of its P100 par ordinary share to Max Las compensation for 1,000 hours of legal services performed, Max L usually bills P500 per hour for legal services. On this date of issuance, the share was selling at a public trading at P150 per share. By what amount should the share premium account of Corridor Company increase as a result of the issuance of those shares? A. P3,000,000 B. P600,000 C. P300.000 D. P900,000 The Magic Lamp Corporation was incorporated on January 1, 2021, with the following authorized capitalization: 40,000 ordinary shares, no par value, stated value P40 per share 10,000 shares of 5% cumulative preference share, par value P10 per share During 2021, Magic Lamp issued 24,000 ordinary share for a total of P1,200,000 and 6,000 preference share at P16 per share, In addition, on December 31, 2021, subscriptions for 2,000 preference shares were taken at a purchase price of P17. These subscribed share were paid for on January 2. 2022.…
Provide complete solution: ABC Company issued 1,000 shares with P5 par to XYZ Company as compensation for 1,000 hours of legal services performed. XYZ Company usually bills P150 per hour for legal services. On the date of issuance, the share was trading on a public exchange at P140. By what amount should the share premium account increase as a result of the transaction? A. P 160,000B. P 145,000C. P 135,000D. P 155,000