Asked by Jenifer Lalnunkimi on Jun 14, 2024
Verified
The comparability of earnings per share across firms is influenced by the relative amount of capital raised by the various firms and by the ability of the firms to manage their reported earnings per share.
Comparability
A quality of accounting information that allows users to analyze and compare financial data from different periods and entities in order to make informed decisions.
Capital Raised
The total amount of funds collected by a company from investors or financial markets, often used for business operations, expansion, or paying off debt.
- Explain how companies manage reported earnings per share and the factors influencing such management.
Verified Answer
BB
Bukky BakareJun 18, 2024
Final Answer :
True
Explanation :
The statement is true. When firms raise different amounts of capital, it can affect their earnings per share. Additionally, the ability of the firms to manage their reported earnings can also impact comparability.
Learning Objectives
- Explain how companies manage reported earnings per share and the factors influencing such management.