Which statement concerning earnings per share is incorrect?
A) Earnings per share is regarded as one of the least important financial ratios.
B) It represents a conversion of the absolute dollar amount of profit to a per share basis.
C) If profits increase earnings per share could still decrease if share capital increases at a greater rate than profits.
D) In calculating earnings per ordinary share, preference dividends are deducted from profit.

Question

Quizplus · Accepted Answer

Earnings per share is actually considered as one of the most important financial ratios as it indicates the profitability of the company on a per-share basis.

Which Statement Concerning Earnings Per Share Is Incorrect