CIMA Exam CIMAPRA19-F02-1 Topic 5 Question 105 Discussion

Actual exam question for CIMA's CIMAPRA19-F02-1 exam

Question #: 105
Topic #: 5

The basic earning per share computed by a company for year ended 31st March 20X7 is 2 per share. The company had certain convertible debentures outstanding as on 31st March 20X7. The conversion of debentures to equity shares would result in the earnings per share to be 2.2. Which of the following should the company disclose?

ABasic earnings per share only

BDiluted earnings per share only

CBoth basic and diluted earnings per share

DNeither basic nor diluted earnings per share

Show Suggested Answer

Suggested Answer: A

by Ezekiel at Jan 13, 2025, 07:49 AM

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My

1 months ago

You know, if I had a convertible debenture, I'd probably just convert it to shares and call it a day. But I guess the company has to play by the rules. C it is, my friends.

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Ramonita

5 days ago

So, should the company disclose both basic and diluted earnings per share?

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Johnna

14 days ago

Yeah, it can definitely impact the earnings per share calculation.

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Erinn

21 days ago

I agree, converting debentures to shares seems like a good idea.

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Tashia

1 months ago

Wait, they want us to disclose nothing? That's like trying to hide the fact that I ate all the donuts in the break room. Not a chance, I'm going with C!

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Jaime

1 months ago

Basic earnings per share? Diluted earnings per share? Sounds like a whole lot of financial mumbo jumbo to me. I'm just going to go with C and hope for the best. Hey, at least it's multiple choice, right?

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Tammy

2 months ago

Ah, the classic diluted earnings per share dilemma. I bet the exam writers are trying to trip us up with that convertible debenture bit. But C is the way to go, no doubt about it.

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Maile

1 months ago

Definitely, disclosing both basic and diluted earnings per share gives a more comprehensive view of the company's financial performance.

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Kate

1 months ago

Yeah, it's better to provide all the relevant information to investors, even if it seems like a tricky question.

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Marlon

1 months ago

It's always important to consider all potential impacts on earnings per share, especially with convertible debentures.

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Jillian

2 months ago

I think it's better to be safe and disclose both basic and diluted earnings per share, just to cover all bases.

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Lettie

2 months ago

I agree, C is the correct choice. Both basic and diluted earnings per share should be disclosed.

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Johanna

2 months ago

It's always important to consider all potential impacts on earnings per share, especially with convertible debentures.

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Jovita

2 months ago

I agree, C is the correct choice. Both basic and diluted earnings per share should be disclosed.

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Fernanda

2 months ago

But what if the conversion of debentures doesn't actually happen? Shouldn't they just disclose basic earnings per share?

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Lanie

2 months ago

Hmm, I think the company should disclose both basic and diluted earnings per share. That way, investors can get a complete picture of the company's performance.

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