Eps

Have you attempted the question yourself? Calculate both the profit for the year attributable to the ordinary share holders and the weighted average number of shares in issue.

Thanks

Hi,

Irredeemable preference shares are treated as equity in the accounts, therefore any dividend will be deducted within the SOCIE. When calculating the EPS we usually use the PBT figure from the SPL as this is the earnings that belong to the ordinary equity shareholders. However, the irredeemable preference dividend has not been removed from this figure as it will be deducted in the SOCIE. To get the right figure to use in the EPS calculation then we will need to deduct the irredeemable preference dividend from the PBT figure.

Give it a go and see how you get on.

Thanks

adjusted profit = 500000- 10000(10% of 100000) = 490000

fpr weighted average share
no.0f shares month bonus fraction weighted average share
at 1 april 400000 1/12 3/2 50000
at 1 may 600000 11/12 550000

eps= 490000/ (50000 +550000 ) = 0.81667 = 81.7 cent per share

Sorry, I don’t get it, in your video, the basic EPS example, for bonus issue, there is no time fraction as it is free so we don’t need to care when it is issued.. so why you multiple with fraction 11/12 here?

Thank you very much