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AS 20
Accountancy
What is meant by restayed basic earning per share? Why it is calculated?....Meaning of theoritical ex-right fair value per share
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It is restated basic EPS. In financial statements information of 2 consecutive years is presented. Say in the year 2019, the basic EPS was Rs. 4 per share. But in 2020, there is a share split or bonus issue, then we have to recalculate the EPS. This is known as restated EPS. It is calculate to show the impact of the additional shares on EPS of previous years. Theoretical Ex-right fair value per share is the value of the share without any attachment of right to apply for right shares. Normally, when a company announces right issue, the current shareholders get the right to subscribe to the right shares at a discounted price. When calculating the Ex-right fair value of shares we, try to estimate the value of share without the right to subscribe to right share.
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CA Suraj Lakhotia Admin
https://youtu.be/UAmC_VnyJOE?t=1028 A quick revision example here. You can go through.
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