EPS = Net Income รท Weighted Average Number of Outstanding Shares
Use net income after taxes
Subtract preferred dividends from net income if calculating basic EPS for common shareholders
Use the weighted average shares outstanding during the period
For diluted EPS, include the effect of convertible securities, options, and warrants
Basic EPS = (Net Income – Preferred Dividends) รท Weighted Average Common Shares Outstanding
Diluted EPS = Adjusted Net Income รท Diluted Weighted Average Shares Outstanding
Report the result as earnings per share in currency units per share