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In its 2020 income statement, how much should ABC Company report as basic earnings per share?

In its 2020 income statement, how much should ABC Company report as basic earnings per share?

FINANCIAL ACCOUNTING
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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a. P11.40

b. P12.00

c. P13.41

d. P14.25

ABC Company had 600,000 ordinary shares outstanding on January 1, 2020. During 2020, ABC Company issued rights to acquire on ordinary share at P10 in the ratio of 1 new share for every 4 shares outstanding. The market value of ordinary share immediately prior to the rights issue is P35. The rights were exercised on October 1, 2020. The net income of ABC Company for 2020 is P8,550,000. In its 2020 income statement, how much should ABC Company report as basic earnings per share?
Transcribed Image Text:ABC Company had 600,000 ordinary shares outstanding on January 1, 2020. During 2020, ABC Company issued rights to acquire on ordinary share at P10 in the ratio of 1 new share for every 4 shares outstanding. The market value of ordinary share immediately prior to the rights issue is P35. The rights were exercised on October 1, 2020. The net income of ABC Company for 2020 is P8,550,000. In its 2020 income statement, how much should ABC Company report as basic earnings per share?
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