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AB had 10 million $0.50 ordinary shares in issue at 1 January 2008. On 1 August 2008 AB issued 2

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AB had 10 million $0.50 ordinary shares in issue at 1 January 2008. On 1 August 2008 AB issued 2 million $0.5 ordinary shares at a premium of $0.30. Throughout the year AB had in issue $2 million 7% convertible bonds redeemable in 2010. The terms of the instrument allow the bondholders to convert every $100 of bonds held to 50 ordinary shares of $0.50. AB's profit available to ordinary shareholders was $3 million for the year ended 31 December 2008. AB pays tax at 30%.
Required:
Calculate the basic and diluted earnings per share for AB for the year ended 31 December 2008.

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Earnings 3 000 000 Weighted average number of shares 5 833 333 10 000 000 7 12 12 …View the full answer


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International Financial Reporting and Analysis

International Financial Reporting and Analysis

ISBN: 978-1408075012

5th edition

Authors: David Alexander, Anne Britton, Ann Jorissen

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Question Posted: April 12, 2016 07:01:16
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