Which of the following statements is correct?
A)The dividend yield and earnings per share both have the same denominator.
B)The dividend yield and earnings per share both have the same numerator.
C)Dividends per share are used in calculating both the earnings per share and the dividend yield.
D)Net income is used in calculating the earnings per share but not in calculating the dividend yielD.Earnings per share equals net income divided by the weighted average number of common shares outstanding.Dividend yield equals dividends per share divided by market price per share.

Question

Quizplus · Accepted Answer

Option A is incorrect, as the dividend yield and earnings per share have different denominators (dividends per share and weighted average number of common shares outstanding, respectively).
Option B is incorrect, as the dividend yield is calculated using dividends per share, while earnings per share are calculated using net income.
Option C is incorrect, as dividend per share is used to calculate only the dividend yield and not earnings per share.
Option D is the correct choice as net income is used in calculating earnings per share but not in calculating the dividend yield.

Which of the Following Statements Is Correct