Which of the following best represents the stream of income that is available to stockholders?
A) Net profit after tax.
B) Earnings before interest, taxes and dividends
C) Gross profit
D) Operating profit

Question

Quizplus · Accepted Answer

Net profit after tax best represents the stream of income that is available to stockholders because it is the amount of money that remains after all the operating expenses, interest, taxes, and dividends to preferred stockholders have been deducted from a company's total revenue. This is what is ultimately available to be distributed to common stockholders or reinvested back into the company.

Which of the Following Best Represents the Stream of Income