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Please I need help with this question
waffle had share capital of $7.5 million in 50c equity shares at 1 October 20×6. On 1 January 20×7 it made an issue of 4 million shares at full market price immediately followed by 1 for 3 bonus issues.
the FS at 30 September 20×7 showed a profit for the year of 12 million.
What is the EPS
Sir I dont understand why the share issue of 4 million is time apportioned.
Is the answer eps = 50 cents?
Oh! That’s a relief!
Why is the 4 million issue time apportioned? Because we want to know the equivalent number of shares in issue for a full year!
4 million in issue for 9 months is the equivalent of 3 million for a full year
We need to time apportion any change in the issued share capital and that’s why the figure we’re looking for is called the Weighted Average Number of Equity Shares in issue during the year
Ok? Or do you need more?
Sir I still dont understand, i have never seen such a question before.
Then you haven’t worked through the examples in the free course notes on this site!