XYZ has 5 million 7% cumulative preference shares and 10 million ordinary shares. The profit after...

 

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XYZ has 5 million 7% cumulative preference shares and 10 million ordinary shares. The profit after tax for the year ended 31 December x1 was RM500,000 and XYZ preference dividend paid for half year amounted to RM175,000. Profit after tax for the year ended 31 December x2 was RM800,000.XYZ declared and paid current year's preference dividends and previous year's preference dividends in arrears. Required: Compute earnings per share for years x1 and x2. XYZ has 5 million 7% cumulative preference shares and 10 million ordinary shares. The profit after tax for the year ended 31 December x1 was RM500,000 and XYZ preference dividend paid for half year amounted to RM175,000. Profit after tax for the year ended 31 December x2 was RM800,000.XYZ declared and paid current year's preference dividends and previous year's preference dividends in arrears. Required: Compute earnings per share for years x1 and x2.

Answer rating: 100% (QA)

To compute the earnings per share EPS for years X1 and X2 we need to calculate the earnings available to ordinary shareholders and divide it by the nu... View the full answer