UK Ltd for the year ended 31 December 2018. Net Profit $500m Preference dividend $300m Share...

UK Ltd for the year ended 31 December 2018.

Net Profit	$500m
Preference dividend	$300m
Share outstanding- Average	4000m

	Earnings effect	Shares effect
Convertible preference share	$300m	3000m
Convertible debt	$120m	3000m
Share options		5000m

The financial statements were authorized in late March 2019.

The diluted earnings per share for the year ended 31 December 2018 is 4.3 cents.

Required:

Assuming that the company made a one for two bonus issue on 3 January 2019. Calculate the diluted earnings per share for the year ended 31 December 2018.
In addition to all the above information, assuming $60m instead of $30m dividend is
paid to the convertible preference shares (cumulative) due to the dividend for year 2017 is not paid. Calculate the diluted earnings per share for the year ended 31 December 2018. Briefly explain the effect of the $60m dividend on the earnings effect.

Expert Solution

ekkarill92 answered 1 year ago

Leek Co’s profit for the year ended 31 December 2018 was €1,500,000. On 1 January 2018...

Leek Co’s profit for the year ended 31 December 2018 was €1,500,000. On 1 January 2018 Leek Co had 500,000 ordinary shares outstanding. On 1 July 2018 there was a full market price issue of 200,000 additional shares. In addition the company has one potentially convertible security: €800,000 of 5% convertible bonds, convertible into a total of 200,000 shares. Assuming a tax rate of 30%, calculate the company’s basic and diluted EPS. For calculating the basic EPS the weighted average...

Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2018...

Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2018 RM RM Sales (-) Cost of sales: Opening inventory (+) Purchases (-) Closing inventory Gross Profit (+) Revenues: Discount received Commission received (-) Expenses: Salaries and wages Repair and maintenance Net Profit 25,000 200,000 (15,000) 10,000 8,300 41,300 100,000 450,000 (210,000) 240,000 18,300 (141,300) 117,000 Statement of Financial Position as at 31 December 2018 RM RM Non-current Assets Building Motor vehicles Current Assets Inventory...

The following information applies to BritanniaBritannia Ltd. for the year ended 31 December 2009: !!ERROR Profit...

The following information applies to BritanniaBritannia Ltd. for the year ended 31 December 2009: !!ERROR Profit after interest and tax (£) 7,500 Number of shares in issue 77,000 Total dividends for year (£) 3,205 Market value per share (pence) 83 Profit before interest and tax (£) 29,600 Requirement: Compute the price/earnings (PE) ratio for BritanniaBritannia Ltd. for 2009. First, calculate the earnings per share (EPS) for the company as follows: (Show your answer in pence, to two decimal places.) EPS...

An analyst compiled the following information Parker Ltd for the year ended December 31 2013: Net...

An analyst compiled the following information Parker Ltd for the year ended December 31 2013: Net Income was $1,600,000 Depreciation expense was $270,000 Amortization expense for a patent was $30,000 Interest paid was $250,000 Income taxes paid were $100,000 Ordinary shares were sold for $200,000 Preference shares (8% annual dividend) were sold at Par value of $250,000 Dividends of $50,000 were paid on ordinary shares Preference dividends of $20,000 were paid Equipment with a book value of $75,000 was sold...

For the year ended December 31, 2018, Carla Vista Ltd. had the following transactions related to...

For the year ended December 31, 2018, Carla Vista Ltd. had the following transactions related to the purchase of property. Assume all transactions are for cash unless otherwise stated. Feb. 7 Purchased real estate for $ 1 million, paying $ 292,700 cash and signing a mortgage payable for the balance. The site had an old building on it and the current values of the land and building were $ 0.9 million and $ 101,400, respectively. The old building will be...

For the year ended December 31, 2018, Norstar Industries reported net income of $655,000. At January...

For the year ended December 31, 2018, Norstar Industries reported net income of $655,000. At January 1, 2018, the company had 900,000 common shares outstanding. The following changes in the number of shares occurred during 2018: Apr. 30 Sold 60,000 shares in a public offering. May 24 Declared and distributed a 5% stock dividend. June 1 Issued 72,000 shares as part of the consideration for the purchase of assets from a subsidiary. Required: Compute Norstar's earnings per share for...

Galaxy Productions’ fiscal year ended 31 December 2019. Their net profit was $2,796, the firms’ equity...

Galaxy Productions’ fiscal year ended 31 December 2019. Their net profit was $2,796, the firms’ equity (new capital) was reduced from $50,000 to $32,796. The was also selling merchandises as part of their revenue. The firm bought a lighting machine for $8,000 in 2017, which has a lifespan of 4 years and its residual value was $500. The firm used the reducing balance method for depreciation. The firm has used Average Costing Method (AVCO) to obtain the closing stock which...

The following independent events for Repertory Theatre Ltd. during the year ended December 31 2018, require...

The following independent events for Repertory Theatre Ltd. during the year ended December 31 2018, require a transaction journal entry or an adjusting journal entry, or both. The company adjusts its accounts annually. 1. Supplies on hand amounted to $1,500 at the beginning of the year. On March 1, additional supplies were purchased for $4,250 cash. At the end of the year, a physical count showed that supplies on hand amounted to $1,000. 2. The theatre owns a vehicle that...

Labels: Current assets Current liabilities December 31, 2018 Expenses For the Year Ended December 31, 2018...

Labels: Current assets Current liabilities December 31, 2018 Expenses For the Year Ended December 31, 2018 Property, plant, and equipment Revenues Amount Descriptions: Book value-building Book value-equipment Change in retained earnings Net income Net loss Retained earnings, December 31, 2018 Retained earnings, January 1, 2018 Total assets Total current assets Total expenses Total liabilities Total liabilities and stockholders’ equity Total property, plant, and equipment Total revenues Total stockholders’ equity CHART OF ACCOUNTS Lamp Light Company General Ledger ASSETS 11 Cash...

Vita Dental Agencies current fiscal year ended on December 31, 2018. For the year then ended,...

Vita Dental Agencies current fiscal year ended on December 31, 2018. For the year then ended, the company has reported an unadjusted net income of $100,000. The owner has some doubt about this figure and has asked you to review his accounting records. Required: Make adjusting entries as at December 31, 2018 for the following information uncovered in your review (show your calculations for full marks): a) Vita occupied their new building for the first time on May 1, 2018....

Question