MOcha 313 DEC11- EPS

Hello Sir, for this question how is the correctness of the EPS 313 Mocha Co (Dec 11 amended) 36 mins The following information relates to the draft financial statements of Mocha Co: SUMMARISED STATEMENTS OF FINANCIAL POSITION AS AT 30 SEPTEMBER 20X1 20X0 $'000 $'000 ASSETS Non-current assets Property, plant and equipment (note (i)) 32,600 24,100 Financial asset: equity investments (note (ii)) 4,500 7,000 37,100 31,100 Current assets Inventories 10,200 7,200 Trade receivables 3,500 3,700 Cash and cash equivalents nil 1,400 13,700 12,300 Total assets 50,800 43,400 EQUITY AND LIABILITIES Equity Equity shares of $1 each (note (iii)) 14,000 8,000 Share premium (note (iii)) nil 2,000 Revaluation reserve (note (iii)) 2,000 3,600 Retained earnings 13,000 10,100 29,000 23,700 Non-current liabilities Lease liability 7,000 6,900 Deferred tax 1,300 900 8,300 7,800 Current liabilities Tax 1,000 1,200 Bank overdraft 2,900 nil Provision for product warranties (note (iv)) 1,600 4,000 Lease liability 4,800 2,100 Trade payables 3,200 4,600 13,500 11,900 Total equity and liabilities 50,800 43,400 SUMMARISED STATEMENTS OF PROFIT OR LOSS FOR THE YEARS ENDED 30 SEPTEMBER: 20X1 20X0 $'000 $'000 Revenue 58,500 41,000 Cost of sales (46,500) (30,000) Gross profit 12,000 11,000 Operating expenses (8,700) (4,500) Investment income (note (ii)) 1,100 700 Finance costs (500) (400) Profit before tax 3,900 6,800 Income tax expense (1,000) (1,800) Profit for the year 2,900 5,000 (iii) On 1 April 20X1 there was a bonus issue of shares that was funded first from the share premium account and then from the revaluation surplus account. This was followed immediately on the same day in April by an issue of shares for cash at par. (iv) The movement in the product warranty provision has been included in cost of sales. the Answer is (b) Earnings per share 30 September 20X0 5,000,000/8,000,000 = $0.63 per share Earnings per share 30 September 20X1 2,900,000/(8,000,000 u 6/12) + (14,000,000 u 6/12) = $0.26 per share for 20x1 The total share including bonus shares should be 8000+3600=11600k into 6/12 then 14000k into 6/12 please clarify this matter Sir, Thanks,