Earnings per Share (EPS)
Consider the following:
- Numbers are assumed.
- You have outstanding two different issuances of bonds ( #1 & #2) as well as two types of preferred stock ( #1 & #2).
- All initially are dilutive.
- You must derive the lowest EPS figure possible, however. What combination of securities will achieve that?
- Note: the individual EPS have been intentionally ranked from lowest to highest.