PRACTICE TOPIC
Earnings Per Share
Practice Earnings Per Share with 8 accounting challenges on Accountely — instant IAS/IFRS-compliant scored feedback on every submission.
What earnings per share covers
Earnings per share expresses profit attributable to ordinary shareholders as an amount per share, which makes results comparable across periods and between companies. The numerator is profit after tax less preference dividends; the denominator is the weighted average number of ordinary shares outstanding during the period, weighted for the portion of the year each tranche was in issue.
Challenges here cover the weighted average calculation, share issues and buybacks during the year, and basic versus diluted figures.
Where marks are usually lost
- Using the closing share count rather than the weighted average.
- Failing to deduct preference dividends from the numerator.
- Treating a bonus issue or share split as though it occurred on its actual date — these are applied retrospectively to all periods presented.
8 Earnings Per Share practice challenges
TitleTypeDifficulty
Brightwell Corporation - Income Statement (Multi-Step) Income StmteasyOakridge Ltd. - Income Statement Income StmtmediumFernhollow Corporation - Income Statement Income StmtmediumAurora Retail Corporation - Multi-step Income Statement with Discontinued Operations Income StmthardCalloway Group - Diluted EPS with Share Options (Treasury Stock Method) Income StmthardSilverpine Group - Income Statement with Basic and Diluted Earnings per Share Income StmthardKestrel Group - Discontinued Operations: Income Statement and Statement of Financial Position Multi-StatementhardHalcyon Digital - Diluted Earnings per Share with Convertible Bonds Income Stmthard