AS-20 Earning Per Share ( EPS)

AS-20 Earning Per Share ( EPS)

Earning per share means company earn profit per share during the particular year.

Accounting Standard 20 is way of determination and presentation of earning per share which help users comparison among different enterprises for the same period.

As know there are two type of shares

1.Equity Shares

  1. Preference  Shares

Earning per share  is calculated for Equity Shares only.

Earning per share is two type



-Basic EPS and Diluted to be presented on the face of the  Statement of profit and loss for each class of equity shares that has a different right to share in the net profit for the period.

-In consolidated financial statements the information required by this standard should be presented on the basis of consolidated information.

How to calculate basic EPS

Net Profit/loss Available to Equity Shareholder


Weight Average Number of Equity Shares

Net profit:

-Profit/ loss after tax Less Preference dividend and tax thereon

-In case of more than one class of equity shares, net profit or loss is apportioned in accordance with dividend right for each class.

Calculate weighted Average Number of Equity shares

-Number of shares outstanding at the beginning of the year period adjusted for increase and decrease during the period.

-Weight= Number of days shares were outstanding during the period as a proportion of the total number of days in the period



Shobha  private Ltd

Net Profit    2017-18   Rs.22,00,000

2018-19    Rs.36,50,000

Number of shares outstanding 2,00,000

Company issue fresh 2,00,000 equity shares  on 01/10/2018

EPS for 2017-18     Profit of 2017-18                       Rs,22,00,000

———————-                        ——————–

Equity shares                               2,00,0000

EPS Rs.11

EPS   for 2018-19

Weighted average number of equity share

Equity shares outstanding during entire year is 2,00,000 equity shares

Equity shares outstanding 6 months only. is 2,00,000

200000*6/12 = 1,00,000 equity shares

so that weighted average number of shares is 3,00,000

EPS = 36,50,000/3,00,00

= Rs.12.16

For example:

XYZA  Pvt Ltd earn profit Rs.2,00,00,000 during 2018-19. It paid share capital is 10,00,000 equity share Rs. 10 per share.


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