Dividing the total stockholders' equity by the average number of shares outstanding at the end of the year (if only common stock is outstanding) is the calculation for
A) book value per share.
B) earnings per share.
C) return on equity.
D) the times interest earned ratio.

Question

Quizplus · Accepted Answer

Dividing the total stockholders' equity by the average number of shares outstanding at the end of the year gives the book value per share. This calculation shows the theoretical liquidation value of a share of stock if the company were to go out of business and all assets were sold and debts paid off.

Dividing the Total Stockholders' Equity by the Average Number of Shares