| 1.99 | Unnamed: 1 | Unnamed: 2 | Unnamed: 3 | Unnamed: 4 | Unnamed: 5 | Unnamed: 6 | Unnamed: 7 | Unnamed: 8 |
|---|---|---|---|---|---|---|---|---|
| a) | Equity Gearing Ratio | AKABUSI PLC | BLACK PLC | MAX MARK 2 | ||||
| (750,000+2,000,000):2,750,000 | (2,500,000+3,000,000):2,000,000 | |||||||
| 1:1 | -1.0 | 2.75:1 | -1.0 | Ratio must be shown x:1 | ||||
| b) | (3,500,000+2,000,000):2,750,000 | MAX MARK 1 | ||||||
| 2:1 | -1.0 | |||||||
| c) | Black plc (£) | |||||||
| Operating Profit | 1750000 | Award corporation tax for 1 mark if Debenture finance cost not included. | ||||||
| less Debenture finance cost | 150000 | -1.0 | ||||||
| 1600000 | ||||||||
| less Corporation Tax | 400000 | -1.0 | ||||||
| PROFIT FOR THE YEAR AFTER TAX | 1200000 | If no preference dividend included award 1 mark for Profit available to ordinary shareholders | ||||||
| Less Preference dividend | 200000 | |||||||
| Profit available to ordinary shareholders | 1000000 | -1.0 | MAX MARK 3 | |||||
| d) | Retained Profit | 600000 | Where the Retained Profit figure is implied, award 2 marks to the Ordinary Dividend | |||||
| ORDINARY DIVIDEND | 400000 | -2.0 | MAX MARK 2 | |||||
| e) | Total percentage dividend to be paid | 400,000/2,000,000 x 100 | ||||||
| 0.2 | -1.0 | MAX MARK 1 | ||||||
| f) | Ordinary Dividend per share | 400000 | ||||||
| 4000000 | ||||||||
| 0.1 | -1.0 | MAX MARK 1 | ||||||
| g) | Earnings per share | 1000000 | ||||||
| 4000000 | ||||||||
| 0.25 | -1.0 | MAX MARK 1 | ||||||
| Profit for the year after interest and tax – preference dividend may be consequential on (i). | ||||||||
| Number of Shares may be consequential on (iii) | ||||||||
| h) | Market Price per share | 7.4 times £0.25 | ||||||
| 1.85 | -1.0 | MAX MARK 1 | ||||||
| i) | Dividend Yield | £0.10 / £1.85 x 100 | ||||||
| 0.05405405405405406 | -1.0 | MAX MARK 1 |