Outstanding Share: The total shares currently issued to all shareholders put together, called outstanding shares. Every company has a different type of investors like individual investors and institutional investors. Every investor owns a certain number of shares. So the total of these share owned by all the investors are called outstanding shares.
Earnings per Share: The Company has a different type of investors like individual investors and institutional investors. Every investor owns a certain number of shares. So when the company earns net income in an accounting period, investors are keen to know the earnings per share to analyze their investment decision in that company. Net income available to equity shareholders is divided by the number of shares outstanding to determine the value of earning per share.
To Identify: The correct option that reflects the earnings per share of L Company.
Want to see the full answer?
Check out a sample textbook solution
Chapter 17 Solutions
Horngren's Accounting, Student Value Edition Plus MyAccountingLab with Pearson eText, Access Card Package
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education