QUESTION 1 (15 Marks) The following information relates to Hardin Limited's year-ended 31 December 2020: ...

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QUESTION 1 (15 Marks) The following information relates to Hardin Limited's year-ended 31 December 2020: • The statement of comprehensive income shows profit for the year of R154 000. The calculation of this profit included the following income and expenses: Impairment of building: R64 000 (before tax: R74 000) • Profit on sale of plant: R23 200 (before tax: R32 000) • Inventory write-down: R10 000 (before tax: R15 000) • The statement of changes in equity reflected preference dividends of R3 450. • 12 000 shares in issue throughout the year. Required: Calculate the basic earnings and the headline earnings and disclose the headline earnings per share for the year-ended 31 December 2020 QUESTION 2 (15 Marks) The following information is provided for Present limited for the year ended 31 December 2020. • Present Limited had basic earnings for 2020 of R520 000. • This basic earnings figure was equal to its profit for the year. It had no components of other comprehensive income. • Present Limited had 2 200 000 ordinary shares in issue throughout 2020. There were 461 000 options in issue at 31 December 2020 (granted to the directors for no value). Required: Calculate basic and diluted earnings per share for the year ended 31 December 2020. END OF PAPER QUESTION 1 (15 Marks) The following information relates to Hardin Limited's year-ended 31 December 2020: • The statement of comprehensive income shows profit for the year of R154 000. The calculation of this profit included the following income and expenses: Impairment of building: R64 000 (before tax: R74 000) • Profit on sale of plant: R23 200 (before tax: R32 000) • Inventory write-down: R10 000 (before tax: R15 000) • The statement of changes in equity reflected preference dividends of R3 450. • 12 000 shares in issue throughout the year. Required: Calculate the basic earnings and the headline earnings and disclose the headline earnings per share for the year-ended 31 December 2020 QUESTION 2 (15 Marks) The following information is provided for Present limited for the year ended 31 December 2020. • Present Limited had basic earnings for 2020 of R520 000. • This basic earnings figure was equal to its profit for the year. It had no components of other comprehensive income. • Present Limited had 2 200 000 ordinary shares in issue throughout 2020. There were 461 000 options in issue at 31 December 2020 (granted to the directors for no value). Required: Calculate basic and diluted earnings per share for the year ended 31 December 2020. END OF PAPER

Answer rating: 100% (QA)

Question 1 Calculation of Basic Earnings Per Share Formula Basic Earnings Per Share Net income Prefe... View the full answer