Earnings per share is an indicator

Assignment Help Financial Management
Reference no: EM131825391

Earnings per share (EPS) is an indicator of a company’s profitability and how its stocks are valued. EPS of a company is directly proportional to its net income. The net income of Tolut Inc. for this year has decreased by 10 percent from last year’s figures. Therefore, the company’s EPS would be less than what it was last year.

Which of the following statements, if true, strengthens the argument??

A. ?Tolut Inc.’s stocks were undervalued in the market last year.

b. ?A high EPS indicates that the company has a high potential for growth in the future.

c. ?Earnings per share do not necessarily fall every time there is a rise in the taxes paid by the company.

d. ?Tolut Inc. has issued additional common shares in the current year.

Reference no: EM131825391

Questions Cloud

Items-accounts that typically appear on balance sheet : The primary goal of management of publicly traded corporation should be to __.Which of the following are items/accounts that typically appear on balance sheet?
The return on an investment in stock : The return on an investment in stock. Which of the following stages of the goal-setting process is the company in??
Explains why the stockholders equity went down : Which of the following statements best explains why the stockholders’ equity went down??
Group development process does this scenario portray : They question the validity of Mathew’s suggestion. Which of the following stages of the group development process does this scenario portray??
Earnings per share is an indicator : Earnings per share (EPS) is an indicator of a company’s profitability and how its stocks are valued.
Task of recording the cash received from customers : In an apparel store, one individual is assigned the task of recording the cash received from customers.
European call contracts and one xer ox european put contract : Mr. Chang bought two Xerox European call contracts and one Xer ox European put contract, both of which expire in three months.
Old time savings bank pays : Old Time Savings Bank pays 3% interest on its savings accounts.
Define cash equivalence : Define Cash Equivalence? Name and Explain two factors when considering refinancing?

Reviews

Write a Review

Financial Management Questions & Answers

  Normally distributed with mean and standard deviation

Suppose the gain from an investment is a normal random variable with mean $10 and standard deviation $1.25. Compute the Variance for this investment. Define the c%-Variance to be the value |v| such that there is only a c% chance that the loss from an..

  Present and future values for different interest rates

Find the following values. Compounding/discounting occurs annually. Define present value.

  Explain how inflation affects the rate of return

MBALN-622 Financial Management - Explain how inflation affects the rate of return required on an investment project, and the distinction between a real and a nominal approach to the evaluation of an investment project under inflation.

  Calculate book value of asset

Genetic Insights Co. purchases an asset for $10,248. This asset qualifies as a seven-year recovery asset under MACRS. Calculate book value of an asset.

  What is the wacc for firm with its new capital structure

Calculate the value of the firm. What is the WACC for the firm with its new capital structure? What is the WACC for the firm with its new capital structure?

  Direct tax an indirect tax

Identify each of the following as a “direct tax,” an “indirect tax,” or something else:

  Price change by using both duration and convexity

Now let's assume that the convexity of this bond is 13.47. Please estimate the price change by using both duration and convexity.

  Regal is evaluating project costing

Regal Industries has the following capital structure. Its corporate tax rate is 35%. Regal is evaluating a project costing $58,000 which will generate $15,000 for 6 years. It will require an increase of $2,000 in NWC at the outset, but no recapture. ..

  Find the amount of the coupon

For a certain period a bond amortization schedule shows that the amount for amortization of premium is $5 and that the required interest is 75% of the coupon. Find the amount of the coupon.

  Fisheries management area if there is good policy objective

Can the maximum sustainable returns be achieved in the fisheries management area if there is a good policy objective?

  Company primary account representative

As an owner of a small company your role doubles as the company's primary account representative.

  What is the annual rate of interest that bowflex charging

What is the annual rate of interest that Bowflex charging?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd