Zen Ltd. has earned a profit of ₹40,00,000 before tax for the year ended 31st March, 2014. Tax amounts to ₹11,40,000. The share capital of the company is ₹60,00,000 (4,00,000 equity share of ₹10 each and 2,00,000, 7% pre

To compute the Earnings Per Share (EPS) of Zen Ltd., we need to follow these steps: Calculate Earnings After Tax (EAT). Calculate Preference Dividend. Calculate Earnings Available to Equity Shareholders. Calculate the Number of Equity Shares. Compute EPS. 1. Earnings Before Tax (EBT): ₹40,00,000 2. Less: Tax: ₹11,40,000 3. Earnings After Tax (EAT): ₹40,00,000 - ₹11,40,000 = ₹28,60,000 4. Preference Share Capital: 2,00,000 preference shares of ₹10 each = ₹20,00,000 5. Preference Dividend (7% of Preference Share Capital): 7% of ₹20,00,000 = ₹1,40,000 6. Earnings Available to Equity Shareholders: EAT - Preference Dividend ₹28,60,000 - ₹1,40,000 = ₹27,20,000 7. Number of Equity Shares: 4,00,000 equity shares 8. Earnings Per Share (EPS): Earnings Available to Equity Shareholders / Number of Equity Shares ₹27,20,000 / 4,00,000 = ₹6.80 Therefore, the Earnings Per Share (EPS) of Zen Ltd. is ₹6.80 .