Multiple Choice
Which of the following best describes the difference between basic and diluted Earnings Per Share (EPS)?
Tougher Company's current year income statement showed an EPS of \$1.25 per share. If total common equity totaled \$600,000 (40,000 common shares) and preferred dividends were \$10,000 (10,000 preferred shares), what was net income during the period?
MoneyCo had sales revenue and net income during the current year of \$500,000 and \$60,000, respectively. The total amount of stockholders' equity was \$600,000, and common shares outstanding were 120,000 all year. What is MoneyCo's earnings per share?