What are earnings per share equal to?

Question

Quizplus · Accepted Answer

Earnings per share (EPS) is calculated by dividing the company's total earnings (which include dividends and retained earnings) by the total number of outstanding shares of stock. It is used as a measure of a company's profitability on a per-share basis. Option A is incorrect, as EPS is not equal to the last dividend payment made. Option C is incorrect, as EPS is not related to the increase in a stock's market price. Option D is incorrect, as EPS is not calculated by dividing revenues by the number of stockholders.

What Are Earnings Per Share Equal To