One way to calculate EPS is:
A)ROA x Book value per share.
B)ROE x Book value per share.
C)ROA/ Book value per share.
D)ROE/ Book value per share.

Question

Quizplus · Accepted Answer

Earnings per share (EPS) is calculated as net income divided by the number of outstanding shares. ROE (return on equity) measures the company's profitability against shareholder's equity, and it is a good indicator of how effectively a company is using its resources to generate returns. Book value per share is the company's equity divided by the number of outstanding shares. Therefore, ROE x Book value per share is the best option for calculating EPS.

One Way to Calculate EPS Is