2

Question 1

the income available for the common share in EPS

Answer 1

NI
- Div. declared on non cumulative preferred
- Div. on cumulative ( weather or not declared)
+- discontinued operation
= NI available

Question 2

the formula for the option , contract to compute DEPS

Answer 2

no of shares - ( no of shares * exercise price )/ average market price

Question 3

WISCO

Answer 3

common shares
\+ stock sold (WA)
- treasury stock (WA) reissue
\+ stock dividend / split as from beginning
- reverse stock split

Question 4

Under IFRS, all of the following are acceptable method of accounting for treasury stock

Answer 4

Par value method.
Cost method.
Constructive retirement method.

Question 5

The purchase of treasury stock

Answer 5

this answer is correct because only the common stock outstanding will be decreased by the amount of treasury stock purchased. When a company reacquires its own stock, the purchase does not reduce the number of shares issued or authorized, but does reduce the number of shares outstanding and the total stockholders’ equity.

Question 6

Which of the following is issued to shareholders by a corporation as evidence of the ownership of rights to acquire its unissued or treasury stock?

Answer 6

this answer is correct because stock warrants are issued to existing shareholders so that they can purchase additional shares of stock in order to maintain their ownership percentage.

Question 7

Dividends per share payout ratio

Answer 7

Dividends per share /

Earnings per share

Question 8

Price earnings ratio

Answer 8

Market price share /

Earnings per share

Question 9

treasury stock affected only

Answer 9

the outstanding shares it has no effect on issued sahres

Question 10

Under IFRS, the method used when preferred shares are converted into ordinary shares is

Answer 10

book value method is the method used to convert preferred shares into ordinary shares.