Reference no: EM132921392
Question - Mandy Mandy has had 5 million shares in issue for many years.
Earnings for the year ended 31 December 2014 were £2,579,000.
Earnings for the year ended 31 December Year 3 were £1,979,000.
Tax is at the rate of 30%.
Outstanding share options of 500,000 shares have existed for a number of years. These can be exercised at a future date at a price of £3 per share.
The average market price of shares in 2013 was £4 and in 2014 was £5.
On 1 April 2013, Mandy issued £1,000,000 convertible 7% bonds. These are convertible onto ordinary shares at the following rates.
On 31 December 2016 30 shares for every £100 of bonds.
On 31 December 2017 25 shares for every £100 of bonds.
On 31 December 2018 20 shares for every £100 of bonds.
Required - Calculate the diluted EPS for 2014 and the comparative diluted EPS doe 2013.