Asked by Camilo Uriza on Jun 10, 2024
Verified
Basic earnings per share (EPS)is always computed by dividing net income by the weighted average number of common shares of stock outstanding.
Basic Earnings Per Share (Eps)
Basic Earnings Per Share (EPS) is a calculation used to gauge a company's profitability on a per-share basis, dividing net earnings available to common shareholders by the average outstanding shares.
Net Income
The remaining income of a company after deducting expenses and taxes from the total income generated.
Weighted Average
A calculation that takes into account the varying degrees of importance of the numbers in a dataset, often used in accounting and inventory valuation.
- Absorb the basic concepts of income statement elements and how they are organized.
Verified Answer
SP
Savannah Petersen
Jun 13, 2024
Final Answer :
False
Explanation :
If there are preferred stock dividends,the numerator would be net income minus preferred stock dividends.
Learning Objectives
- Absorb the basic concepts of income statement elements and how they are organized.