Deloitte. FRS VIEW ADD GO Question 1 Message Centre Crater Inc\'s annual net pro

Question

Deloitte. FRS VIEW ADD GO Question 1 Message Centre Crater Inc's annual net profit for 2009 was $1,274,000. There were no discontinued operations. Ordinary shares increased to 1,100,000 on 6 April 2009 when 100,000 new $1 ordinary shares were issued. Crater has 500,000 1 5% preference shares Tax rate is 30% What are Crater Inc's basic earnings per share for 2009? Select one option and click Submit O $1.14 O $1.16 Tools Background Coach Examples Reference O $1.18 Clue O $1.19 Calculator Wod SUBMIT Excel EXIT HELP PRINT ACTION PLANNER 2/12

Explanation / Answer

Weighted average shares = (1000000/365*95)+(1100000/365*270)= 1073973 Preferred dividends = 500000*5% = 25000 Basic earnings per share = (1274000-25000)/1073973= 1.16 Option 2 is correct

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