Financial Management - Study Mode

[#811] Earnings Per Share (EPS) is equal to __________.
Correct Answer

(B) Profit after tax/No of outstanding shares

Explanation

Solution: Earnings Per Share (EPS) is equal to Profit after tax/No of outstanding shares. It is calculated by dividing the company's net income with its total number of outstanding shares. It is a tool that market participants use frequently to gauge the profitability of a company before buying its shares.

[#812] __________ are a way U. S. investors can invest in foreign companies.
Correct Answer

(A) ADRs

Explanation

Solution: ADRs are a way U. S. investors can invest in foreign companies. American depositary receipts (ADRs) can simplify the access of U.S. investors to foreign markets. Listed on the New York Stock Exchange and Nasdaq, they can be traded, settled and held as if they were ordinary shares of U.S.-based companies.

[#813] Business risk can be measured by:
Correct Answer

(B) Operating leverage

[#814] Between two capital plans, if expected EBIT is more than indifference level of EBIT, then:
Correct Answer

(C) One is better than other

[#815] Ageing schedule incorporates the relationship between:
Correct Answer

(B) Debtors and Days Outstanding