For calculating EPS, the following order will be followed.(A) Calculate number of equity shares(B) Calculate earning available for equity share holders(C) Compute profit after tax(D) Compute EPSChoose the correct answer from the options given below :
- A(C), (B), (A), (D)
- B(A), (B), (C), (D)
- C(B), (A), (C), (D)
- D(C), (A), (B), (D)
Solution & Step-by-step Explanation
To calculate Earnings Per Share (EPS), the logical sequence is:Compute the overall Profit After Tax (PAT) (C).Deduct preference dividends (if any) to calculate Earnings available for equity shareholders (B).Ascertain the weighted average number of equity shares outstanding (A).Compute EPS by dividing earnings by the number of shares (D).Thus, the correct order is (C), (B), (A), (D).