Question：EPS can be affected in many ways.
　　Which one or more of the following options regarding the EPS are incorrect?
　　A. A rights issue is a combination of an issue of shares at full market price coupled with a bonus element.
　　B. A bonus share issue has no effect on the earnings capacity of a company.
　　C. A bonus share issue may increase EPS.
　　D. A rights issue will have no effect on EPS.
　　The correct answers are: A bonus share issue may increase EPS; and A rights issue will have no effect on EPS.
　　A rights issue will have no effect on EPS is incorrect. The effect of a rights issue will be to increase the earnings capacity and the number of shares. There will thus be an effect on EPS.
　　解析：A bonus issue may increase EPS is incorrect. There will be more shares in issue following a bonus issue which will have a diluting effect on EPS. No additional productive assets are available for the company, a bonus issue is simply a capitalisation of reserves.