Before common stock per share is computed, preferred stock is considered.

Name: Before common stock per share is computed, preferred stock is considered.
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When computing earnings per share (EPS) for common stock, any dividends on preferred stock are subtracted from net income before dividing by the number of common shares outstanding, because preferred dividends are typically fixed and must be paid out before any earnings can be distributed to common shareholders.

Before Common Stock Per Share Is Computed, Preferred Stock Is