Q250
Which of the following ratios is not affected by the financial structure and the tax rate of a company?
A.
Net profit margin
B.
Earning power
C.
Earnings per share
AnswerD.
Capitalization rate
Answer: Option C
Solution
Answer: Option C
Solution:
Earnings per share ratios is not affected by the financial structure and the tax rate of a company.
It is calculated by dividing the company's net income with its total number of outstanding shares. It is a tool that market participants use frequently to gauge the profitability of a company before buying its shares.