EPS Is Important to Common Shareholders for All of the Following

question 11

Multiple Choice

EPS is important to common shareholders for all of the following reasons, EXCEPT

• A) it indicates the amount of income that is earned by each common share.
• B) common shareholders have a residual interest in the company.
• C) it is an indicator of cumulative dividend payments.
• D) it is an indicator of the amount of income earned by each share.

---

Definitions:

Accounting

The systematic process of recording, measuring, and communicating financial information about economic entities.

Notice

A formal communication or announcement, often legal in nature, which informs parties about certain actions or conditions.

Agreement

An agreement is a mutual understanding or contract between parties outlining terms and conditions for a specific action or inaction.

Liable

Having legal responsibility or obligation, typically requiring payment for damages or to remedy a breach of contract.