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An entity had 1 million shares in issue on 1 January 20X1. They issued
200,000 shares at market value on 1 April 20X1, followed by a 1 for 5
bonus issue on 1 August 20X1, with a further 300,000 issued at market
value on 1 October 20X1.
If profit for the year ending 31 December 20X1 is $220,000, what is
the basic earnings per share?
My calculation :
1st April – 150,000
Bonus – 240,000
1st Oct – 11- 75,000
TOTAL = 1,465,000
As per book = 1,455,000
Please help me understand the mistake here?
They have issued 200,000 shares at 1 April and not the 150,000 that you are showing. Try changing this to see if it then works out.