Z Co had 80,000 shares in issue and makes a 1 for 4 rights issue on 1 September 20X6 at $1.00 per share. The last cum-rights price was $1.50. Total earnings for 20X6 were $120,000.
What was the EPS for 20X6 in $s (to the nearest cent)
Remember, multiply the number of shares before the rights issue by the fraction of the year before the date of issue (X/12) and by the following fraction:
Market price on the last day of quotation with rights
