Page 395 - Microsoft Word - 00 CIMA F1 Prelims STUDENT 2018.docx

Answers

Example 5.2

EPS = 63c

Profit attributable to ordinary shareholders 600 – 150
Basic EPS = ––––––––––––––––––––––––––––– ––––––––
Weighted average of ordinary shares (W1) 720

= 62.5c = 63c

(W1) Weighted average number of ordinary shares

b/f n/12 Bonus Total
Fraction
1st May 600m 4/12 6/5 240
1st September 720m 8/12 480

–––––
720m

–––––

Example 5.3

Comparative EPS = 38c

Bonus fraction = 6/5 (1 new share for every 5 held).

Comparative = EPS × inverse of bonus fraction = 45c × 5/6 = 37.5c = 38c

387