Explain what is diluted eps

Assignment Help Accounting Basics
Reference no: EM132654452

Compaq Ltd has a net income after tax of $2 000 000 for the year ended 30 June 2018. At the beginning of the period Compaq Ltd has 900 000 fully paid-up ordinary shares on issue. On 1 January 2018 Compaq Ltd had issued a further 300 000 fully paid-up ordinary shares at an issue price of $2.00. On 1 March 2018 Compaq Ltd made a one-for-five bonus issue of ordinary shares out of retained earnings. The last sale price of an ordinary share before the bonus issue was $2.50. At the beginning of the current period Compaq Ltd also had 500 000, $1.00, 5% cumulative preference shares on issue. The dividends on the preference shares are not treated as expenses in the statement of comprehensive income. The basic earnings per share for the period ended 30 June 2017 was $1.50 per share.

Required:

Problem a) Calculate the basic EPS amount for 2018.

Problem b) Explain what is diluted EPS. Give one example of a security that can dilute the basic EPS.

Reference no: EM132654452

Questions Cloud

Creators of bretton woods economic system : Discuss the priorities of the creators of the Bretton Woods Economic system. Were their objectives achieved? Explain.
Calculate the basic eps amount for compaq ltd : Calculate the basic EPS amount for 2018. Compaq Ltd has a net income after tax of $2 000 000 for the year ended 30 June 2018.
Calculate the expected annual sick-leave expense for dainty : Provide the journal entry necessary to recognise the sick-leave entitlement expense as it accrues each week. Calculate the expected annual sick-leave expense
Public policy analysis : Discuss the rationale of the policy and how your model will assist policy makers in their decision making and implementation processes.
Explain what is diluted eps : Compaq Ltd has a net income after tax of $2,000,000 for the year. Explain what is diluted EPS. Give one example of a security that can dilute the basic EPS.
Classify the items as either product costs or period costs : Classify the following items as either product costs or period costs. Depreciation on a vehicle used by the entitys general manager
Discuss the depreciation method that is suitable : Name examples of the Property Plant and Equipment assets that are used in your business, and discuss the depreciation method that is suitable
Explain the miranda warnings : How would you explain the Miranda warnings and their significance to a friend of yours not in the criminal justice field?
Prepare the journal entries to record the purchase : On 1 July 2017, Rock the Wok Ltd acquired equipment for $100,000 cash. Prepare the journal entries to record the purchase of equipment. Nations are required

Reviews

Write a Review

Accounting Basics Questions & Answers

  What is the marginal impact of advertising on sales

What is the marginal impact of advertising on sales if advertising is increased from $1500 to $1600? What is the marginal impact on sales

  Prepare the entry to distribute the labor cost

Prepare the entry to distribute the labor cost if the job worked on during overtime was a rush order, the contract price of which included the overtime premium

  Describe the type of investments the company has used

Describe the type of investments the company has used. Identify a company which requires significant long-term debt or equity to run their operations.

  Sacred heart hospital purchased a 150000 special radiology

sacred heart hospital purchased a 150000 special radiology scanner from hospital supply inc. the scanner has a useful

  Explain the meaning of each of the simpson company ratios

Please review the following 6 ratios for Simpson Company and ABC Inc. for the year ended 2014, Explain the meaning of each of the Simpson Company ratios above

  What is the year-end balance in prepaid insurance account

If $1,725 of insurance has expired during the year, what is the year-end balance in the prepaid insurance account

  Write about five accounting-related topics

Please write about any two topics in the letter that you find interesting. Then write about five accounting-related topics that Buffett speaks to in the letter.

  What is the amount of applied overhead

The following information was taken from the records of a manufacturing company: What is the amount of applied overhead

  Balance sheet for the patent

During 2010, Palmiero determined that the economic benefits of the patent would not last longer than 6 years from the date of acquisition. What amount should be reported in the balance sheet for the patent, net of accumulated amortization, at Dece..

  What is the Net Cash Flow from Investing

Purchases of Property, Plant, & Equipment of $5,700,000. What is the Net Cash Flow from Investing and Financing Activities

  Variable manufacturing and selling costs per

It anticipates fixed manufacturing costs of $200,500 and fixed general and administrative expenses of $80,000 for the year. Variable manufacturing and selling costs per set of head covers will be $8 and $12, respectively. Each set will sell for $3..

  Johnson complex fabrications is metal parts manufacturing

johnson complex fabrications is a metal parts manufacturing company. it has developed a new process for producing

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd