Which of the Following Statements Is False About Earnings Per

question 39

Multiple Choice

Which of the following statements is false about earnings per share:

• A)is a required disclosure on the face of the income statement
• B)is a common size measure of a company's earnings performance
• C)is the amount that each stockholder will receive as dividends that period
• D)reflects the amount of a company's earnings belonging to each shareholder on a per share basis

---

Definitions:

Direct Labor-Hours

A measure of the actual labor time spent on producing goods, often used to allocate manufacturing overhead to products.

Plantwide Predetermined Rate

A single overhead absorption rate calculated for an entire manufacturing plant, used to allocate manufacturing overhead to individual products.

Machine-Hours

A measure of production time, indicated by the number of hours machines are operating in the manufacturing process.

Manufacturing Cost

The total cost incurred by a company to produce goods, including raw materials, labor, and overhead.