Knowee
Questions
Features
Study Tools

1 January – Shares in issue 1,000,00031 March – Rights issue of 1 for 5 shares at 90 cents– MV of shares $1 (cum-rights price)Required:Calculate the number of shares for use in the EPS calculation.

Question

1 January – Shares in issue 1,000,00031 March – Rights issue of 1 for 5 shares at 90 cents– MV of shares $1 (cum-rights price)Required:Calculate the number of shares for use in the EPS calculation.

🧐 Not the exact question you are looking for?Go ask a question

Solution

To calculate the number of shares for use in the EPS calculation, follow these steps:

  1. Identify the initial number of shares: In this case, it's 1,000,000 shares.

  2. Determine the rights issue: Here, it's 1 for 5 shares. This means for every 5 shares a shareholder owns, they have the right to buy 1 additional share.

  3. Calculate the number of additional shares from the rights issue: Divide the initial number of shares by 5 (the rights issue ratio). 1,000,000 / 5 = 200,000 additional shares.

  4. Add the additional shares to the initial number of shares: 1,000,000 initial shares + 200,000 additional shares = 1,200,000 total shares.

So, the number of shares for use in the EPS calculation after the rights issue is 1,200,000.

This problem has been solved

Similar Questions

ABC ltd has capitalization rate 10%, has 5000 shares seeling 100 Rs each. Firm is going to declare div of Rs 6. Find the price of share at the end of current financial year.Options :102104110115

1. Question 1 In 20x0, Chitchat Ltd issued 1M shares @$1/- per share in its IPO. In a subsequent issue in 20x1 it sold 1M shares @$2/- per share. In 20x2 it issued a fully subscribed and paid 1-for-1 rights issue @$3/- per share. In 20x3, it splitthe outstanding shares into 2-for-1 shares. What is the share capital and number of shares issued after the share split? Choose one of the following answers. 8M shares & $4.5M in share capital 4M shares & $9M in share capital 8M shares & $9M in share capital 8M shares & $8M in share capital

At the beginning of 2023, BBB Corporation was organized with authorized capital of 100,000, P200 par value shares. January 15 – Issued 10,000 shares at P280 per share.May 1 – Issued 5,000 shares in exchange for land with a fair value of P1,200,000. On this date, fair value of the shares was P250 per share.November 23 – Issued 2,000 shares for legal services when the fair value was P260 per share.What amount should be reported as share premium?

On 1 January 20X4, Sam Co had 3 million ordinary shares in issue. On 1 June 20X4, SamCo made a 1 for 3 bonus issue. On 30 September 20X4, Sam Co issued a further 1 millionshares at full market price. Sam Co had profits attributable to ordinary equity holders of $2million for the year ended 31 December 20X4.What is the basic earnings per share figure for the year ended 31 December 20X4, accordingto IAS 33 Earnings Per Share?A 47.1¢B 52.2¢C 56.8¢D 50.0¢

Storico currently has 36,000 shares outstanding that sell for $48.05 per share. The company plans to issue a stock dividend of 12.5 percent. How many new shares will be issued?

1/3

Upgrade your grade with Knowee

Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.