Which of the following statements is true of earnings per share?

A. A company must pay tax on the earnings per share.
B. Earnings per share can be maximized by changing from corporation to proprietorship form of organization.
C. A company can maximize its value by maximizing earnings per share.
D. Earnings per share is often used as an indication of the firm's potential for generating future cash flows.
E. A high earnings per share in the current period results in lower future risk position of the business.


Answer: D

Business

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