Of the Following,select the Incorrect Statement Concerning Earnings Per Share

question 39

Multiple Choice

Of the following,select the incorrect statement concerning earnings per share.

• A) During periods when all income is paid out as dividends,earnings per share and dividends per share under a simple capital structure would be identical.
• B) Under a simple capital structure,no adjustment to shares outstanding is necessary for a stock split on the last day of the fiscal period.
• C) During a period,changes in stock issued or reacquired by a company may affect earnings per share.
• D) During a loss period,the amount of loss attributed to each share of common stock should be computed.

---

Definitions:

Acid Test Ratio

A financial metric that measures a company's ability to pay off its current liabilities with its quick assets (cash, marketable securities, and receivables).

Temporary Investments

Investments not intended to be held for a long term and may include stocks or bonds, classified for easy liquidation.

Debts to Total Assets Ratio

A financial metric indicating the proportion of a company's assets that are financed through debt, assessing financial leverage.

Debt to Stockholders' Equity

A financial ratio that measures the proportion of a company's debt to the equity held by its shareholders.