(a) The issued share capital of Manfred, a quoted company, on I November 2004 consisted of 36,000,000 ordinary shares of 75 cents each. On I May 2005 the company made a rights issue of I for 6 at $1.46 per share. The market value of Manfred’s ordinary shares was $1.66 before announcing the rights issue. Tax is charged at 30% of profits.

Manfred reported a profit after taxation of $4.2 million for the year ended 3 I October 2005 and $3.6 million for the year ended 3 I October 2004. The published figure for earnings per share for the year ended 3 I October 2004 was 10 cents per share.

Required:

Calculate Manfred’s earnings per share for the year ended 3 I October 2005 and the comparative figure for the year ended 3 I October 2004.

(b) Brachly, a publicly quoted company, has 15,000,000 ordinary shares of 40 cents each in issue throughout its financial year ended 3 I October 2005. There are also:

• 1,000,000 8.5% convertible preference shares of $1 each in issue classified as equity. Each pre¬ ference share is convertible into 1.5 ordinary shares.

• $2,000,000 12.5% convertible loan notes. Each $1 loan note is convertible into two ordinary shares.

• Options granted to the company's senior management giving them the right to subscribe for 600,000 ordinary shares at a cost of 75 cents each.

The statement of comprehensive income of Brachly for the year ended 3 I October 2005 reports a net profit aftertax of $9,285,000 and preference dividends paid of $85,000. Tax on profits is 30%. The average market price of Brachly's ordinary shares was 84 cents for the year ended 3 I October 2005.

Required:

Calculate Brachly’s basic and diluted earnings per share figures for the year ended 31 October 2005.

(The Association of International Accountants)