Question

Profit available for equity shares is Rs. 30,000 and Number of Equity Shares is 15,000 and Number of preference shares is 10,000. Earnings per share (EPS) is: (A)2 (B)1.20 (C)3 (D)5​

Answer 1

Answer:

Step-by-step explanation: 30000/15000

                                           =2 (ANS)

Answer 2

Answer:

Option A is the correct answer.

Step-by-step explanation:

EPS = profit available for equity shares/ number of Equity shares.

EPS = $30000$ ÷$15000$

        =  $2$

Therefore, Earning Per Share = 2

• Earnings per share are calculated by dividing a company's net profit by the number of common shares outstanding.

• EPS is a widely used indicator for measuring corporate value since it shows how much money a firm produces for each share of stock it owns.

• A higher EPS suggests more value since investors would pay more for a company's shares if they believe the company's profits are larger than its share price.

• EPS can be calculated in different ways/ methods, including omitting unusual items or ceased activities, or on a diluted basis.

• Earnings per share, like other financial metrics, is most valuable when compared to rival metrics, companies in the same industry, or over time.

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