Earnings per share figures are shown in the income statement:

Question

Quizplus · Accepted Answer

Earnings per share figures are typically shown for income before extraordinary items and for income from continuing operations, as well as for net income. This is because these figures are most relevant in understanding the performance of a company's ongoing operations, and excluding extraordinary items allows for better comparison between periods.

B is incorrect because earnings per share figures are generally only shown for common stock, as they represent ownership in the residual earnings of the company after all other liabilities have been paid. Preferred stock may have a fixed dividend payout, but does not represent ownership in the same sense as common stock.

C and D are incorrect because earnings per share figures are required to be disclosed by publicly traded corporations as a matter of SEC regulations. Private corporations may choose to omit or disclose them at their discretion, but this is not relevant to the question of where they are typically shown in financial statements.

Earnings Per Share Figures Are Shown in the Income Statement