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Following extract belongs to Faisalabad Corporation:
Outstanding 10 million common shares of Rs. 10 each
Issued debentures worth Rs.10 million bearing interest amounting to Rs.55, 000 convertible into common shares in one year time with 5 shares of every Rs.10 debenture.
Tax is charged . 35% by the taxation authority.
Profit after tax Rs. 4.5 million
What will be the value of basic EPS?
What will be the value of diluted EPS?
Has the dilution really occurred? If so, then analyze its effect on profit and EPS of the