Author : Jeffrey Jay Jewell
Publisher :
ISBN 13 :
Total Pages : 15 pages
Book Rating : 4.:/5 (13 download)
Book Synopsis What Is Your EPS? Issues in Computing and Interpreting Earnings Per Share by : Jeffrey Jay Jewell
Download or read book What Is Your EPS? Issues in Computing and Interpreting Earnings Per Share written by Jeffrey Jay Jewell and published by . This book was released on 2018 with total page 15 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines several problematic issues in the presentation of information related to earnings per share (EPS) that are common to college textbooks and popular investment websites. U.S. generally accepted accounting principles (GAAP) require disclosure of EPS for all publicly listed firms. In fact, EPS is the only financial ratio required by GAAP and it is the only financial ratio with a formula specified by GAAP. Despite these facts, many college textbooks and investment websites present incorrect formulas for the computation of EPS. Furthermore, many textbooks and investment websites either explicitly or implicitly encourage students and investors to interpret EPS incorrectly. This paper discusses these issues and contrasts proper EPS computation and interpretation with the most common errors in computation and interpretation.