Question

Earnings per share is an important disclosure because... A: Net income disclosed in the financial statements...

Earnings per share is an important disclosure because...

A: Net income disclosed in the financial statements can fluctuate based upon management's intentions

B: It provides information relevant to the common shareholders

C: It forces common and preferred shareholders to read the financial statements

D: It uses net income

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Answer #1

Earning per share (also known as EPS) is an important disclosure because it provides relevant information to common shareholders.

Also ot lets the shareholders know earning of the company per share and not total, which is easy to analyze by small shareholders.

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