In Calculating Earnings Per Share,the Denominator of the Equation Includes

question 48

Multiple Choice

In calculating earnings per share,the denominator of the equation includes:

• A)Only common stock outstanding.
• B)Common stock plus preferred stock.
• C)Common stock less preferred stock.
• D)The total shares of authorized common stock.

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Definitions:

Selling Price

The amount of money for which a product or service is offered for sale to customers.

Customer Refund Payable

A liability account representing the obligation of a business to return money to a customer due to overcharging or returning merchandise.

Accounting Equation

A fundamental financial principle representing the relationship between an entity’s assets, liabilities, and equity; expressed as Assets = Liabilities + Equity.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing the owners' share of the company.