Which of the Following Statements Is True

question 38

Multiple Choice

Which of the following statements is true?

• A)Investors need to understand that the value of a company's earnings per share is affected by its choices of accounting principles and assumptions.
• B)Earnings per share is calculated for a company's preferred stock.
• C)The most widely quoted measure of a company's earnings performance is return on equity.
• D)The book value per share measures the market value of a corporation's stock.

---

Definitions:

Bad Debts

Accounts receivable that a company is unable to collect, often written off as an expense because they are considered irrecoverable.

Accounts Receivable

Money owed to a business by its clients for goods or services delivered but not yet paid for.

Bad Debts

Amounts owed to a company that are not expected to be received, often due to the debtor being unable to pay. These are often written off as an expense.