CHAPTER 9

MULTIPLE CHOICE

1.The ratio percentage of earnings retained is the same as that termed:

a.

dividend yield

b.

dividend payout

c.

this year's retained earnings to net income

d.

return on common equity

e.

book value

ANS:C

2.The earnings per share is computed for:

a.

common stock

b.

non-redeemable preferred

c.

redeemable preferred

d.

common stock and non-redeemable preferred stock

e.

common stock and fully diluted preferred stock

ANS:A

3.In 2010, ABC Company reported earnings per share of for 10,000 shares. In 2011, there was a 2-for-1 stock split, for which 2011 earnings per share were reported at . The appropriate earnings per share presentation for a 2-year comparative analysis would be:

2011

2010

a.

b.

c.

...