Diploma in Accounting

Financial Accounting V

Quiz 1

EARNING PER SHARE [EPS]

Question 1 – BASIC EPS

Fond Bhd ad profit after tax for 2010 of RM 500,000 and an issued share capital of RM 1,500,000
comprising 1,000,000 ordinary shares of RM 0.50 each and 1,000,000 RM 1.00 10% preference shares.

Calculate the basic EPS for 2010.

[2 marks]

Question 2 – FRESH ISSUE

The following information is available for Samad Bhd as at 31 December 2010:

Number of Ordinary Shares

Share in issue at 1 January 2010 2,000,000
Share issued for cash at market price on 30 September 2010 800,000

Calculate the basic EPS for 2010 if profit before tax is RM 1,200,000 and the tax rate is 25%.
[3 marks]

Question 3 – SHARE BUYBACK

As at 1 January 2010 Simon Bhd has RM 2,400,000 issued share capital consist of 1,200,000 ordinary
share of RM 2.00 each. The company decide to repurchase the 200,000 of the ordinary share on 1 April
2010 since the cost of capital is higher than cost of debts. The profit after tax of the company for 2010 is
RM 600,000.

Calculate the basic EPS of Simon Bhd for year 2010.

[2.5 marks]

Question 4 – BONUS ISSUE

Shah Bhd has 1,500,000 ordinary share of RM 1.00 as at 1 January 2010. The company increase is share
by issuing 2 bonus share for every 5 share held on 31 August 2010. The profit attributable for ordinary
share for 2010 is RM 950,000.

Calculate the basic EPS for 2010.

[2.5marks]