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 20×1

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,