Earnings Per Share Is Used for Which Kind of Evaluation

question 81

Multiple Choice

Earnings per share is used for which kind of evaluation?

• A)The ability of a company to pay its current liabilities
• B)The overall profitability of a company
• C)The ability of a company to pay its non-current liabilities
• D)Evaluating shares in a company from an investor's perspective

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Definitions:

Value-Added Cost

Costs that contribute to increasing the value of a product or service from the perspective of the customer, such as improvements in quality or features.

Theory of Constraints

A management philosophy focusing on identifying and managing the most significant limiting factor (constraint) that stands in the way of achieving a goal.

Bottlenecks

Points of congestion in a system where the actual or potential capacity is less than the demand, leading to delays or slowdowns.

Target Costing

A pricing strategy where the selling price of a product is determined first, and then the manufacturing cost is managed to ensure profitability.