(a) The issued share capital of Manfred, a quoted company, on 1 November 2004 consisted of 36,000,000 ordinar y shares of 75 cents each. On 1 May 2005 the company made a rights issue of 1 for 6 at $1.46 per share. The market value of Manfred’s ordinar y shares was $1.66 before announcing the rights issue. Tax is charged at 30% of profits.

Manfred repor ted a profit after taxation of $4.2 million for the year ended 31 October 2005 and $3.6 million for the year ended 31 October 2004. The published figure for earnings per share for the year ended 31 October 2004 was 10 cents per share.

Required:
Calculate Manfred’s earnings per share for the year ended 31 October 2005 and the comparative figure for the year ended 31 October 2004.

(b) Brachly, a publicly quoted company, has 15,000,000 ordinar y shares of 40 cents each in issue throughout its financial year ended 31 October 2005. There are also:
● 1,000,000 8.5% conver tible preference shares of $1 each in issue. Each preference share is conver tible into 1.5 ordinar y shares.
● $2,000,000 12.5% conver tible loan notes. Each $1 loan note is conver tible into 2 ordinar y shares.
● Options granted to the company’s senior management giving them the right to subscribe for 600,000 ordinar y shares at a cost of 75 cents each.
The income statement of Brachly for the year ended 31 October 2005 repor ts a net profit after tax of $9,285,000 and preference dividends paid of $85,000. Tax on profits is 30%. The average market price of Brachly’s ordinar y shares was 84 cents for the year ended 31 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)