EPS

CFA Level I
#21

> > Shares for Diluted: > > 1.5*100,000*3/12+ > 1.5*(100,000+50,000)*3/12+(1.5*150,000+50,000)*3/1 > 2+(1.5*150,000+50,000+10,000)*3/12=233,750 > > Diluted EPS=5,000,000/233,750=21.39 Map, can you explain how did you calculate the weighted average number of shares outstanding for the above? I mean, where this numbers come from…I know how it works :slight_smile: but I want just to be really clear with EPS because in the solution they use a slightly different methology…so I dont want to mess up with this

#22

I’ll use thousands, it is easier on eyes with the 0s:) 100 existing at the beginning of the year gets hit with the scrip, existing from Jan to April1, 3/12 of the year At April 1, there is an issue of 50 plus the existing at the beginning of the year (100), that gets hit by the scrip, existing from April 1 to July 1, 3/12 of the year At July 1st, conversion of the preferred, 50 new as a plus to those that existed at June 30, existing from July 1 to October 1, 3/12 of the year At October 1st, issue of new 10, that adds to the existing at September 30, From Oct 1 to Dec 31, 3/12 of the year Add them all

#23

map1 Wrote: ------------------------------------------------------- > I’ll use thousands, it is easier on eyes with the > 0s:) > > 100 existing at the beginning of the year gets hit > with the scrip, existing from Jan to April1, 3/12 > of the year > At April 1, there is an issue of 50 plus the > existing at the beginning of the year (100), that > gets hit by the scrip, existing from April 1 to > July 1, 3/12 of the year > At July 1st, conversion of the preferred, 50 new > as a plus to those that existed at June 30, > existing from July 1 to October 1, 3/12 of the > year > At October 1st, issue of new 10, that adds to the > existing at September 30, From Oct 1 to Dec 31, > 3/12 of the year > > Add them all Thanks!!! Grazie mille! :slight_smile: In the solution I have they just add 25000 to the weighted average number of shares calculated under the basic EPS

#24

Which is correct, since the 50,000 is outstanding only half of the year, so the addition would be exactly 50*6/12=25,000