Asked by Janiel Samuels on Jul 03, 2024
Verified
When analysts provide basic EPS for income from continuing operations that exclude the effects of special (i.e.,nonrecurring) gains or losses and certain other non-cash charges,such earnings are frequently referred to as
A) normal earnings.
B) pro forma earnings.
C) sustainable earnings.
D) real earnings.
Pro Forma Earnings
Financial results excluding one-time events to give investors an idea of a company's normal earnings potential.
Basic EPS
Basic Earnings Per Share, a calculation that shows how much earnings are available to common stockholders, on a per-share basis.
Sustainable Earnings
Earnings resulting from the core operations of a company, expected to continue into the future without significant variation.
- Acquire knowledge on the principles of revenue recognition and how it influences the net income recorded in financial statements.
Verified Answer
CD
chirag darajiJul 06, 2024
Final Answer :
B
Explanation :
Pro forma earnings are often adjusted to exclude non-recurring items and certain non-cash charges, providing a view of the company's performance that the management believes is more reflective of its ongoing operations.
Learning Objectives
- Acquire knowledge on the principles of revenue recognition and how it influences the net income recorded in financial statements.